Limits of General Liability Insurance Policies
Posted on July 2nd, 2011
General liability insurance policies often come with various limits of liability which define how much it can pay for claims that are covered. Liability limits are usually stated on the policy’s declarations page and are agreed to once the policy has been written by the insurance provider. Read on to learn more about the different types of limits of general liability limits.
Per Occurrence Limit: This limit would be coverage limit for every occurrence and is the maximum that the policy can pay to third parties to cover injuries or damages that they sustain as a result of the negligence of the company. This limit would usually apply regardless of the number of individuals that were affected as long as they were all the result of one occurrence.
General Aggregate Limit: This limit is the maximum amount that a policy would be paying, regardless of the total number of occurrences. This limit is the result of the revision that general liability insurance policies underwent back in the 1980s. Before this revision, policies are required to cover an unlimited number of occurrences. The general aggregate limit can be the same as the per occurrence limit or twice the per occurrence limit.
Personal and Advertising Injury Limit: This limit would apply to maximum amount of coverage that a policy can provide to pay for bodily injury and property damage that a third party sustains.
Products or Completed Operations Aggregate Limit: This limit can also be found with some general liability insurance policies and would be the maximum amount of coverage that a policy can provide for bodily injury or property damage that arises out of the completed work or products of the business.
Understanding the limits of the general liability insurance policies you are considering to get is imperative so that you would be able to determine which one can provide you with the type of coverage you require for your business. Make sure that before signing the agreement, you would first be clarifying everything about the policy, including those that can and cannot be covered to prevent getting into sticky situations later on.
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