What does Limits Under Multiple Policy Years mean? Read on to discover the definition & meaning of the term Limits Under Multiple Policy Years - to help you better understand the language used in insurance policies.
Limits Under Multiple Policy Years
An approach to structuring limits for insurance programs covering low-frequency but high-potential-severity exposures, such as excess liability (over commercial general liability (CGL) policies), pollution liability, and directors and officers (D&O) liability. Under this approach, a single aggregate limit remains in effect for multiple years as opposed to a series of separate policy limits, applicable to single years, as under a traditional approach. Since a single limit applies over several years, a higher limit than would typically be purchased in a single policy year can usually be obtained at a lower cost.
We hope the you have a better understanding of the meaning of Limits Under Multiple Policy Years.