Which of the following is a correct example of multiple limits in a policy?

• A. Per person limit, per accident limit, and aggregate limit.
• B. A single uniform limit for all claims.
• C. Only a per-claim limit with no other restrictions.
• D. No limit on the policy term.

Answer: (A)

Multiple limits in a policy spread protection across different ways a claim can arise. The example with a per person limit, a per accident limit, and an aggregate limit shows how coverage can be capped in layers: each person injured has a maximum they can pay, the total for a single incident is capped, and the total payments over the policy term are also capped. This structure helps ensure that individual losses don’t exhaust all coverage, while also preventing one event or the entire term from using up the entire fund. In contrast, a single uniform limit isn’t layered—it doesn’t illustrate separate caps for individuals and for events. A per-claim limit with no other restrictions is only one limit, not multiple, and no limit on the policy term ignores the aggregate cap that controls total payouts over time.