A General Liability policy will include a Per Occurrence (or Each Occurrence) Limit and a General Aggregate Limit.
Per Occurrence Limit: Is the most the company will pay for Bodily Injury and Property Damage arising out of any one occurrence.
General Aggregate: Is the most the company will pay for Bodily Injury and Property Damage durring the policy term.
Here is a quick video that explains The Each Occurrence vs. General Aggregate Limit of a General Liability Policy:
Sample General Liability Policy Limits:
Let’s say a Business has the following limits:
- Per Occurrence Limit of: $1,000,000
- General Aggregate Limit of: $2,000,000
Extreme Claim Examples for One Business (during the same policy term):
- Claim #1: The Business is determined to be Liable and required to pay a settlement of $1,100,000
- The Insurance Company will pay $1,000,000 (the each occurrence limit) leaving the Insured to pay the remaining $100,000
- Claim #2: The Business is determined to be Liable and required to pay a settlement of $1,000,000
- The Insurance Company will pay the full claim
- Claim #3: The Company is determined to be Liable and required to pay a settlement of: $50,000
- The Insurance Company will pay $0 because the General Aggregate limit of $2,000,000 has been completely exhausted by the 2 prior claims.
If you are a Business that is involved in Business to Business Sales, the Per Occurrence Limits you have will likely be determined by the partnerships you have - example:
- A Manufacturer that will sell their products at a major retailer, will be required to comply with the Liability Limit Requirements of the Retailer.
- A Missouri Contractor will have to comply with the Each Occurrence Limit requirements of Building Owners or if they are a subcontractor, they will have to meet the requirements of the General Contractor.
- A Restaurant, that does not own their building will have to comply with the Liability requirements of the Landlord
Call (636-519-0059) or email today and we will work with you to design the Best General Liability Coverage for your Business
Posted by: Dan@hebbeln-ins.com