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.

BREAKING DOWN '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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RELATED FAQS
  1. How are open market operations and monetary policy related?

    An aggregate limit is the maximum amount an insurance company agrees to pay to cover claims during a defined period, generally ... Read Full Answer >>
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    Though the ins and outs of health insurance are often confusing, the concept of the insurance deductible is relatively straightforward. ... Read Full Answer >>
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