What is BB Mart's general aggregate limit after paying a claim of $375,000?

What is BB Mart's general aggregate limit after paying a claim of $375,000?

• A. $700,000
• B. $375,000
• C. $625,000
• D. $1,000,000

Answer: (A)

To understand BB Mart's general aggregate limit after paying a claim, it’s essential to first grasp what a general aggregate limit is in insurance terms. This limit typically represents the maximum amount that an insurer will pay for all claims incurred during a policy period, excluding any specific claim limits that may apply. In this scenario, if the general aggregate limit was initially set at $1,000,000 and a claim of $375,000 has been paid, the remaining amount available for future claims is calculated by subtracting the amount paid from the general aggregate limit. Hence, the calculation is as follows: Initial Aggregate Limit: $1,000,000 Amount Paid for Claims: $375,000 Remaining Aggregate Limit: $1,000,000 - $375,000 = $625,000 However, the question asks for the general aggregate limit after a claim has been paid, not the remaining available limit. Since the aggregate limit is the total limit for the policy period, it remains unchanged at $1,000,000 unless the policy is revised or a new one is taken, regardless of claims paid out. Therefore, after the claim payment, the general aggregate limit is still $1,000,000, and no adjustments are

To understand BB Mart's general aggregate limit after paying a claim, it’s essential to first grasp what a general aggregate limit is in insurance terms. This limit typically represents the maximum amount that an insurer will pay for all claims incurred during a policy period, excluding any specific claim limits that may apply.

In this scenario, if the general aggregate limit was initially set at $1,000,000 and a claim of $375,000 has been paid, the remaining amount available for future claims is calculated by subtracting the amount paid from the general aggregate limit.

Hence, the calculation is as follows:

Initial Aggregate Limit: $1,000,000

Amount Paid for Claims: $375,000

Remaining Aggregate Limit: $1,000,000 - $375,000 = $625,000

However, the question asks for the general aggregate limit after a claim has been paid, not the remaining available limit. Since the aggregate limit is the total limit for the policy period, it remains unchanged at $1,000,000 unless the policy is revised or a new one is taken, regardless of claims paid out. Therefore, after the claim payment, the general aggregate limit is still $1,000,000, and no adjustments are