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📋 '''Aggregation clause''' is a contractual provision found in [[Definition:Insurance policy | insurance policies]] and [[Definition:Reinsurance treaty | reinsurance treaties]] that defines the conditions under which multiple related [[Definition:Loss | losses]] or [[Definition:Claim | claims]] may be grouped together and treated as a single [[Definition:Occurrence | occurrence]] or event. This grouping has profound financial implications: it determines whether a series of losses triggers one [[Definition:Deductible | deductible]] or several, and whether recoveries fall within one [[Definition:Policy limit | policy limit]] or stack across multiple limits. The wording of an aggregation clause is therefore among the most consequential — and most frequently litigated — language in any insurance contract.

🔍 In practice, the clause will specify the connecting factor that ties individual losses together. Common formulations include "arising out of one event," "originating from one cause," or "attributable to a single source or occurrence." In [[Definition:Professional liability insurance | professional liability]] and [[Definition:Directors and officers liability insurance (D&O) | D&O]] policies, for instance, the clause might aggregate all claims stemming from a single wrongful act or series of related wrongful acts. In [[Definition:Reinsurance | reinsurance]], hours clauses serve a similar function for [[Definition:Natural catastrophe | natural catastrophe]] covers, limiting the window during which losses from one weather system can be combined. The precise language matters enormously: slight differences in wording can shift millions in [[Definition:Claims reserve | claims reserves]] from one treaty layer to another.

⚖️ Disputes over aggregation clauses rank among the most complex in insurance litigation, because the answer to "what counts as one event?" is rarely self-evident. The Lloyds Market Association and various industry bodies have published model wordings to promote consistency, yet bespoke language remains widespread. For [[Definition:Underwriter | underwriters]] and [[Definition:Broker | brokers]], negotiating a well-crafted aggregation clause is essential to aligning policyholder expectations with the carrier's intended [[Definition:Risk appetite | risk appetite]]. When the clause is vague or poorly drafted, it creates uncertainty that inflates legal costs and delays [[Definition:Claims settlement | claims settlement]] — an outcome that serves nobody's interest.

'''Related concepts'''
{{Div col|colwidth=20em}}
* [[Definition:Aggregation]]
* [[Definition:Occurrence]]
* [[Definition:Hours clause]]
* [[Definition:Batch clause]]
* [[Definition:Policy limit]]
* [[Definition:Deductible]]
{{Div col end}}

Definition:Aggregation clause - Revision history

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