Insurance glossary · How policies work
aggregate limit.
The aggregate limit is the most a policy pays for all claims during the policy period. Once it’s used up, the policy stops paying until it renews.
What does the aggregate limit cap?
Everything the policy pays for covered claims during the policy year, across all occurrences. Once it’s used up, the policy stops paying claims until it renews, even if each individual claim was under the per-occurrence limit.
Why does a general liability policy have more than one aggregate?
Standard policies split them: a general aggregate for most claims and a separate products and completed operations aggregate for claims from your finished work and products. A year of jobsite claims doesn’t eat into the limit for claims from finished work, or the other way around.
Does the aggregate reset every year?
Yes, at each renewal, for claims that occur in the new policy year. On an occurrence policy, a claim is paid from the aggregate of the year the injury or damage happened, not the year the claim arrives.
Do defense costs use up the aggregate?
Not on most standard general liability policies, where defense is paid outside the limits. On policies where defense is inside the limits, legal fees use up the aggregate along with settlements and judgments.
What is a per-project or per-location aggregate?
An endorsement that gives each project or location its own general aggregate, so a large claim on one job doesn’t use up the limit for the others. Contracts on larger projects often require it.
What happens when my aggregate runs out mid-year?
The policy stops paying new claims for that year. An umbrella may drop down to sit in place of the exhausted aggregate, depending on its wording, and some insurers will reinstate the aggregate for added premium. Contracts that need continuous limits treat an exhausted aggregate as a problem.
Does the aggregate limit work differently by state?
The policy mechanics are the same everywhere. What varies by state is whether contractor licenses require minimum aggregate limits, covered on the per-occurrence limit page, and how courts count occurrences. The notes below cover Riza’s licensed states.
in the states where Riza is licensed.
Riza is a licensed insurance agency in New York, Colorado, Texas, Florida, Massachusetts, Arizona, Nevada, North Carolina, New Jersey and Georgia. Notes below cite the law they come from. Detailed write-ups cover Arizona, Nevada, Texas, North Carolina and New York. One-line notes for other licensed states appear with them when this term has one.
- ArizonaArizona’s contractor license doesn’t require general liability insurance, so aggregate limits come from contracts and owners, not the state.A.R.S. § 32-1152 · A.R.S. § 32-1122contractors in Arizona →
- NevadaNevada’s contractor license doesn’t require general liability insurance, so aggregate limits come from contracts and owners.NRS ch. 624 · NAC ch. 624contractors in Nevada →
- TexasTexas sets aggregate minimums for some trade licenses: electrical and Class A air conditioning contractors need at least $600,000 aggregate and $300,000 products and completed operations, and Class B air conditioning contractors $200,000 aggregate.16 Tex. Admin. Code § 73.40 · 16 Tex. Admin. Code § 75.40contractors in Texas →
- North CarolinaNorth Carolina’s contractor licenses don’t require general liability insurance, so aggregate limits come from contracts and owners.N.C.G.S. ch. 87, art. 1 · N.C.G.S. ch. 87, art. 4contractors in North Carolina →
- New YorkNew York City sets liability requirements for licensed trades and registered general contractors through its Department of Buildings; outside the city, aggregate limits generally come from contracts and local rules.NYC DOB insurance guidelines · NYC DOB, general contractor registrationcontractors in New York →
by trade.
- General contractorsWith many subs as additional insureds and owners as additional insureds on your policy, a per-project aggregate is often the only way to keep each job’s limit intact.
- PlumbingWater damage claims from finished work come out of the completed operations aggregate, which deserves the same attention as the general aggregate.
- RoofingRoofing’s completed operations aggregate carries most of its long-tail risk.
where you’ll see it.
- Declarations page“General aggregate limit” and “Products-completed operations aggregate limit.”
- Contracts“General aggregate of not less than …, applying per project.”
- Loss runsPaid and reserved amounts that show how much of a year’s aggregate is already used.
watch the limit, not just the price.
Riza tracks how much of each year’s aggregate your claims have used, matches aggregates and per-project endorsements to your contracts, and makes sure your umbrella sits above them the way the contracts expect.
Get a quoterelated terms.
Coverage it touches: General liability · Umbrella and excess