Policy limit

Policy limit

The maximum dollar amount of coverage provided by an insurance company for a certain policy.

Policy Limit

The maximum benefit an insurance company will pay a policyholder if/when an insured event occurs. For example, a health insurance policy may have a policy limit of $2 million. This means that the most the insurance company will pay in the case of catastrophic illness is $2 million. Many policy limits are rather high and most policyholders do not need to worry about medical bills of, say, $2 million. However, some long-term illnesses may result in medical bills that approach the limit. See also: Pre-existing condition.
References in periodicals archive ?
Gerard Naisse, the newly elected Chairman, commented that the $400 million dividend demonstrates the Board's commitment to return value to OIL's shareholders and comes on the heels of several value increases over the past few years that include a policy limit increase of $50m to $300m in 2012, a $100m premium credit in 2013, a $300m dividend in 2014 and a further $100m policy limit increase to $400m in 2015.
1 million judgment because they had an opportunity to settle the case for the policy limit, but failed to do so in bad faith.
Varna airport has an insurance policy limit of EUR 51A 000 and Burgas a of EUR 60A 000.
Generally, the policy limit that applies to this first layer of liability coverage is minimal.
Third, in some policy forms, defense costs paid on behalf of an additional insured may erode the policy limit.
The cost to repair the plane was more than the policy limit of $280,000 so he asked his insurance carrier, National Union Fire Insurance Co.
This largely depends on cost considerations and the specifics of your existing D & O insurance, particularly the amount of the aggregate policy limit.
All defense costs for covered claims will be paid up to the per incident policy limit.
Railsback alleged that had she known the true policy limits, she would not have settled for $25,000 but did so only because she thought this was the Mid-Century policy limit and the most that could reasonably be obtained.
For instance, if the present value of the policy limit is close to the premium amount, the parties are basically in agreement on the amount of the known loss and are providing a mechanism for payment over time through the transfer of current premium dollars by the policyholder to the insurer.
Finally, although the insurance company's obligation was contractually and legally limited to the payment of up to half of the stated policy limit if the residence were rebuilt, the insurance company unilaterally agreed to bear the cost of replacement of the vintage structure and to pay B's living expenses during the interim.
First, most of the aggregate policy limit in a large D & O insurance program is provided by the excess policies.