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Contractor’s Guide to Aggregates

Insurance can be a confusing business. Policy language can make little or no sense, especially when you’ve got jobs piling up, subcontractors to deal with and project owners to appease. What is all this “aggregate” business on Commercial General Liability Insurance policies and certificates? Which ones should be checked on your insurance certificate? Which one should your subs be checking? Does it really matter? Yes, it matters. Here is the certificate we are referring to: What’s An Aggregate? The first thing we need to define is what is an aggregate?  A policy has several limits including Each Occurrence and General Aggregate. The General Aggregate limit is often referred to as the policy limit. This is the most that the policy will pay out on all claims over the life of the policy. Policy Aggregate The first checkbox on the certificate indicates that the General Aggregate Limit Applies per POLICY. What does that mean? In the picture above the GENERAL AGGREGATE limit is $2,000,000. The top limit is an Each Occurrence Limit of $1,000,000. So in any one occurrence, the policy will pay out $1,000,000. The General Aggregate or policy limit is $2,000,000. There can be any number of claims on a policy, but the policy limit will be $2,000,000. Once that is exhausted there will be no more claims paid. If the POLICY box is checked on the certificate, that means the policy aggregate limit is $2,000,000. What does that mean to you? It means that if you have a claim against this policy, the dollar value of all claims against the policy will be limited by the amount...