An aggregate limit is the most your insurer will pay for all covered claims combined during the policy term. Your per occurrence limit caps any single loss, but the aggregate is the ceiling on the whole year. Once claims payments use it up, coverage for that line is gone until renewal, no matter how many months remain.
You will see aggregate limits on the declarations page of a general liability policy, and contract insurance requirements almost always specify both a per occurrence and an aggregate figure.
Aggregate Limit
The maximum amount an insurer will pay for the sum of all covered losses during the policy period, regardless of the number of claims, claimants, or occurrences.
How do aggregate limits work on a general liability policy?
The standard commercial general liability form, CG 00 01, carries two aggregates, and they do not mix. The General Aggregate Limit caps everything paid under the policy except products and completed operations losses: premises liability, medical payments, personal and advertising injury, and damage to rented premises all draw it down. The Products-Completed Operations Aggregate is a separate pool that pays only bodily injury and property damage within the products-completed operations hazard, meaning claims from your products or from work you have finished.
A typical small business policy shows $1,000,000 per occurrence with a $2,000,000 general aggregate and a $2,000,000 products aggregate. Each paid claim applies first against the occurrence limit, then reduces whichever aggregate it belongs to. You cannot move money between the two aggregates, and once one is exhausted the insurer also stops defending new claims under it.
What happens when the aggregate runs out?
Coverage under that aggregate simply ends for the rest of the policy term.
Say a contractor's policy pays a $700,000 premises claim in March and a $900,000 slip and fall in June against a $2,000,000 general aggregate. Only $400,000 remains for every other non-products claim that year. A third premises loss of $600,000 in August collects $400,000, and the insured owes the rest personally. A products claim in September, though, would still be paid in full from the untouched products aggregate.
This is why lenders and project owners ask for evidence that your aggregate is intact, and why the certificate reviewer on a large project may reject a COI showing a shared aggregate already eroded by prior claims. Underwriters can add a designated project general aggregate endorsement so each job gets its own aggregate.
Frequently asked questions
What is the difference between per occurrence and aggregate limits?
The per occurrence limit is the most the policy pays for any single occurrence. The aggregate limit is the most it pays for all occurrences combined during the policy term. A $1,000,000 per occurrence and $2,000,000 aggregate policy can fully pay two maximum losses in one year.
Do aggregate limits reset each year?
Yes. Aggregates apply to the policy period, so a renewal starts a fresh aggregate. They do not reset mid-term, and extending a policy period usually does not add aggregate unless the insurer endorses it.
Can I restore an exhausted aggregate?
Sometimes. Some insurers offer an aggregate reinstatement endorsement for an additional premium, and umbrella policies can sit above exhausted underlying aggregates. Ask your broker before the aggregate is gone, not after.
Why does my contract require a $2,000,000 aggregate?
The other party wants assurance that earlier claims against you will not empty the policy before their claim arrives. Since your aggregate is shared across all your work that year, larger projects often require a per project aggregate endorsement instead.
This definition is for educational purposes. Your policy's specific terms, conditions, and endorsements control. Talk to a licensed broker about your actual exposures.