Per Occurrence vs. Aggregate Limits

A per occurrence limit is the maximum your insurer pays for a single claim. One incident, one payout cap. If your general liability insurance policy has a $1 million per occurrence limit, that's all the insurer pays for that claim regardless of how high total damages and legal costs climb.

Here's how that works on a slip-and-fall:

• Policy limit: $1 million per occurrence
• Claim total: $1.3 million
• Policy pays: $1 million
• Gap: $300,000 out of pocket

This is designed to cap coverage for one high-cost incident.

An aggregate limit is the maximum your insurer pays across all claims during the policy period. Per occurrence limits apply per event. The aggregate is a yearly cap, where every payout decreases it until the policy renews.

Per occurrence and aggregate limits work together to cap what a policy can pay for one claim and across the policy period. While the per occurrence limit applies each time there’s a covered incident, the aggregate limit can be reduced over time by multiple claims. How this works can vary by policy type and structure and some coverages share the same aggregate, while others have separate aggregate buckets.

• Shared aggregate: A $1 million per occurrence / $2 million aggregate policy pays $900,000 on Claim 1 and $800,000 on Claim 2. Both fall under the per occurrence limit, but together they've consumed $1.7 million of the $2 million aggregate. Only $300,000 remains for the rest of the policy period.
• Separate aggregate: Many general liability policies carry a general aggregate and a separate products-completed operations aggregate. Products claims draw from one pool. Other liability claims draw from the other. Depleting one doesn't necessarily leave you without coverage.

Per occurrence limits cap each claim. Aggregate limits cap the policy year. Both numbers matter because together they define the outer boundary of what your coverage can pay. Check both when reviewing quotes or existing policies.