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 ?
and that the risk-averse insured chooses an optimal insurance policy limit [[lambda].
The plaintiff, Kimberly Zilisch, alleged that State Farm had dragged out its evaluation of her auto insurance claim for months, and then the company offered only half of her request for the full underinsured motorist policy limit.
AAA case no 412010064637, the Applicant's claim exceeded the policy limit and the Applicant alone was entitled to payment of its claim.
Farinas attempts to cope with this problem by placing insurers in a position where one or more multiple claimants will frequently have a claim for bad faith damages that will exceed the policy limit, if prompt settlements were made that a jury later finds failed to protect the insured's interests.
The program allows carriers to manage policy limits by providing automated policy limit tracking at both the occurrence and aggregate level, bulk payment processing, reapportioning of losses over multiple policy years, and a complete financial audit trail.
After the $500 deductible, all defense costs for covered claims will be paid up to the per incident policy limit.
Premiums are generally 1 to 2% of the policy limit.
An insurer who is not given an opportunity to prevent an excess judgment by settling the underlying claim usually is liable only up to the policy limit.
Coverage by net department revenue would fall to the department's policy limit of 2.
The jury awarded plaintiffs damages in excess of the coverage that Fitzpatrick had pursuant to his insurance policy with defendant and, in this action, plaintiffs seek damages in the amount of the difference between the verdict and the policy limit.
However, more than one insurance professional has testified that medical bills (as opposed to actual records) were sufficient proof of damages, particularly when the bills approached or exceeded the policy limit or the bills contained some description of the claimant's injuries.
At his session on Policy Limit Demands, at Claims' upcoming ACE*SCLA conference, Pollack will focus on efforts that claimants' attorneys are making to take the lid off the limits.