Liability insurance is a good idea for nearly any business, but it becomes essential if you operate in an industry with high-cost projects or strong government regulations. If you own such a company and need liability coverage, you’ll first need to understand the difference between per project aggregate and per location aggregate.
Definition of Per Project
The aggregate on your insurance policy is how much your agency will pay if you need to file a claim. If your coverage includes a per-project aggregate, it means that the amount of the policy is available for each project. For example, if you have a $2 million policy and eight projects, each one is covered for up to $2 million. Keep in mind that these policies cost more since they are available at a greater risk to the agency.
Definition of Per Location
A per location aggregate works much like a per project one. Instead of covering ongoing projects, though, it covers completed projects that you own. Again, imagine your $2 million policy. If you have two offices, or an office and a warehouse, or any combination of properties, the aggregate provides a full $2 million coverage for each location. Like the project aggregate, the location aggregate will cost a bit more than a traditional policy.
Choosing the Right Option
Whether you need a per project or per location aggregate, if any, depends on your industry, the size of your projects or number of locations, and more. Watercolor Management can help you determine which type of insurance policy will best protect your assets.