What does an aggregate deductible encompass?

The aggregate deductible refers to the total amount that an insured individual must pay out-of-pocket for covered losses within a specified policy period, often a year, before the insurer begins to pay for claims. This type of deductible is often seen in health insurance or some property insurance policies and is cumulative in nature, meaning it applies to the total claims made within the timeframe rather than per incident.

In contrast, other options focus on different aspects of deductibles. The maximum claim allowed per incident addresses the limitations on the insurance payout for a single claim rather than the aggregate amount. Specific types of losses may have different deductibles assigned, but these would not fall under the definition of aggregate deductibles, as they are focused on specific incidents or types of damages. Lastly, an individual deductible for each item insured pertains to a per-item basis rather than a collective total across the policy period. Hence, the concept of an aggregate deductible genuinely encompasses the total deductible that applies across multiple claims within a defined timeframe.