Which statement best describes aggregate excess insurance?

Which statement best describes aggregate excess insurance?

• A. It caps losses from a single occurrence.
• B. It provides coverage after a cumulative per-occurrence loss limit is breached.
• C. It covers unlimited total losses.
• D. It replaces the need for a security deposit.

Answer: (B)

Aggregate excess insurance protects you after losses accumulate to a defined amount over the policy period. It sits above your self-insured retention, kicking in once the total incurred losses reach the pre-set attachment point (the aggregate threshold) and then paying eligible losses up to the excess limit. This means it doesn’t cap a single event, and it isn’t unlimited—there’s an overall limit for the period. It also doesn’t replace a security deposit. The description that it provides coverage after the cumulative losses exceed the attachment point best describes how aggregate excess insurance works.

Aggregate excess insurance protects you after losses accumulate to a defined amount over the policy period. It sits above your self-insured retention, kicking in once the total incurred losses reach the pre-set attachment point (the aggregate threshold) and then paying eligible losses up to the excess limit. This means it doesn’t cap a single event, and it isn’t unlimited—there’s an overall limit for the period. It also doesn’t replace a security deposit. The description that it provides coverage after the cumulative losses exceed the attachment point best describes how aggregate excess insurance works.