Aggregate Limit

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DEFINITION of 'Aggregate Limit'

A contract provision used in insurance to limit the amount that can be paid in the policy period. An aggregate limit is the maximum dollar amount your insurer will pay to settle your claims. Often the limit is referred to as an annual aggregate limit, which is just the total amount your insurer will pay in a single year.

INVESTOPEDIA EXPLAINS 'Aggregate Limit'

For example, if your annual aggreate limit is $20 million, and you have $25 million worth of claims that occured in the period, then the company would only pay up to $20 million. Also, aggregate means you can have multiple claims in one period but again any sum exceeding the limit would not be paid out.

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