Components of an Insurance Policy Sample Clauses

Components of an Insurance Policy. Although the physical appearance and contents of an insurance policy may vary greatly depending on the issuing insurer, the type of coverage involved, and when the policy was issued, there are certain basic components typically found in almost any insurance policy. The most significant of these are discussed in this Chapter. [1]—Declarations Most insurance policies contain a section entitled the “Declara- tions.” Often, policy “Declarations” are contained on a separate “Dec- larations Page,” typically attached as the first page of the policy. The purpose of the “Declarations” is to set forth certain basic information about the parties and the type of insurance coverage involved. Thus, the “Declarations” section usually will contain information concern- ing the following: • the identity of the insurer providing the coverage; • the identity of the policyholder(s) covered by the policy; • the type of insurance coverage provided (e.g., comprehensive general liability, directors’ & officers’ liability, professional liability, etc.); • the effective dates of the insurance coverage; • the amount of coverage provided (i.e., the policy’s dollar lim- its of coverage), including any aggregate limits; • the applicable policy retention or deductible; • the identity of any insurance agent or broker involved in plac- ing the coverage; and • the amount of premium to be charged for the insurance cov- erage. [a]—Per Occurrence and Aggregate Limits The “Declarations” section of liability insurance policies indicates that the limits of liability of the policy are being provided on either a “per occurrence” and/or “aggregate” basis. As the name suggests, “per occurrence” limits are the dollar limits of insurance coverage available for each and every occurrence, accident or loss covered by the policy. “Aggregate” limits identify the total dollar amount that the insurer will pay under the policy with respect to claims or losses cov- ered by the “Aggregate” limits provisions. A policy providing “per occurrence” limits of liability without any “aggregate” limits will be required to pay the “per occurrence” limit for each and every covered occurrence, no matter how many such occurrences take place. Such policies provide a theorically limitless amount of insurance coverage, subject only to a cap on the amount of insurance provided with respect to each particular occurrence. In contrast, policies containing “aggregate” limit provisions place a lim- itation on the total amount of cove...