Per-occurrence limit
The per-occurrence limit is the maximum the policy will pay on any single covered claim. If a single event produces $1.5M in damages and your per-occurrence limit is $1M, the policy pays $1M — the remaining $500K is your exposure (or covered by your umbrella, if you have one).
Aggregate limit
The aggregate limit caps total payouts across all claims during the policy period (typically 12 months). On a $1M / $2M policy with three $700K claims in one year, the policy pays the first two in full and the third only up to the remaining $600K of aggregate. Once the aggregate is exhausted, the policy is effectively spent until renewal — you would have to buy back coverage mid-term.
Commercial umbrella structure
A commercial umbrella adds excess coverage above the primary GL, commercial auto, and employer's liability. The umbrella attaches at the primary limit and pays once the primary is exhausted. Common structures:
- $1M GL + $1M umbrella: $2M total tower for any single claim
- $2M GL + $1M umbrella: $3M total tower; common contract requirement
- $2M GL + $5M umbrella: $7M total tower; common at large venues, festivals
- $1M GL + $5M umbrella: $6M total but only $1M from primary; less common because primary maxes out faster
What venues commonly require
- Private weddings, small events: $1M / $2M
- County parks, school districts: $1M / $2M with primary and non-contributory wording
- Corporate events, large weddings: $2M / $1M umbrella
- State fairs, festivals: $2M / $5M total tower; multi-tier additional insured
- High-rise property managers: $5M+ aggregate; sometimes $10M for elevator and roofing contractors
- Government contracts: Varies; specific minimums per contract
How limits affect premium
Per-million cost decreases at higher tiers. Common cost ladder:
- $1M / $2M baseline
- $2M / $4M: typically 30–50% more than baseline (depending on class)
- $2M / $1M umbrella: roughly the $2M GL premium plus $500–$2,000 umbrella
- $5M aggregate: 20–35% more than the $2M tier
High-severity classes (roofing, mechanical bull, axe throwing, adventure attractions) see steeper jumps because the probability of a claim reaching the higher attachment is higher.