noun
sublimit
In plain English
A smaller cap inside the main policy limit that applies to a specific kind of loss.
Cyber policies are full of these — ransomware sublimit, regulatory fine sublimit, social engineering sublimit. The headline limit might be $1M, but the sublimit on the actual loss type might be $100K. Always read past the marquee number.
What it covers
A specific peril, coverage, or loss type up to a stated dollar amount that's lower than the main policy limit.
What it does not cover
It is NOT additional to the main limit. The sublimit is part of the main limit, not on top.
Where it trips people up
On commercial property, sublimits for sewer backup, pollution, mold, ordinance-or-law are easy to miss because the headline limit looks fine. The sublimit page is where the actual coverage analysis happens.
The technical version
A reduced limit of insurance applying to specified perils, coverages, or property categories, typically less than the policy's overall limit and inclusive of (rather than additional to) it.