What does an aggregate or aggregate limit of liability mean in general liability insurance?
(1) A limit in an insurance policy stipulating the most it will pay for all covered losses sustained during a specified period, usually a year. Aggregate limits are commonly included in liability policies. While not often used in property insurance, aggregates are sometimes included for certain catastrophic exposures, e.g., earthquake and flood. (2) During one specified period, the dollar amount of reinsurance coverage is usually 12 months for all reinsurance losses sustained under a treaty during such a period.
An insurance contract provision limits an insurer’s maximum liability for a series of losses in a given time, e.g., a year or the entire contract period. Sometimes called “annual aggregate limit.”
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