Which term represents the overall cap on liability for bodily injury and property damage within the policy’s duration?

Which term represents the overall cap on liability for bodily injury and property damage within the policy’s duration?

• A. Aggregate
• B. Limit of Liability
• C. Combined Single
• D. Per Occurrence

Answer: (A)

The main idea here is the aggregate limit. The aggregate is the total maximum the insurer will pay for all bodily injury and property damage claims that come up during the entire policy period. It sets an annual cap on what the insurer will cover, so once that total is reached, further claims in that term aren’t covered (unless other coverages apply). In contrast, a per occurrence limit would cap the payout for a single incident, so multiple separate events could occur; the total paid could exceed that per-incident cap if the aggregate allows it. A combined single limit is a single amount that applies to BI and PD for each individual occurrence, not the whole policy period. And a general limit of liability label can refer to either per-claim or total limits depending on wording, but doesn’t specify the annual cap by itself.

The main idea here is the aggregate limit. The aggregate is the total maximum the insurer will pay for all bodily injury and property damage claims that come up during the entire policy period. It sets an annual cap on what the insurer will cover, so once that total is reached, further claims in that term aren’t covered (unless other coverages apply).

In contrast, a per occurrence limit would cap the payout for a single incident, so multiple separate events could occur; the total paid could exceed that per-incident cap if the aggregate allows it. A combined single limit is a single amount that applies to BI and PD for each individual occurrence, not the whole policy period. And a general limit of liability label can refer to either per-claim or total limits depending on wording, but doesn’t specify the annual cap by itself.