Maximum Liability
/ˈmæksɪməm lɪəˈbɪləti/
Definitions
- (n.) The greatest amount of financial responsibility a party agrees to assume under a contract or insurance policy.
The maximum liability under the insurance policy is capped at $1 million.
- (n.) The upper limit on damages or losses that can be claimed or enforced by law or contract.
The contract specifies the maximum liability for breach of confidentiality.
Forms
- maximum liabilities
Related terms
See also
Commentary
Maximum liability clauses are critical in contracts to limit exposure; their precise drafting influences risk allocation and enforceability.
This glossary is for general informational and educational purposes only. Definitions are jurisdiction-agnostic but reflect terminology and concepts primarily drawn from English and American legal traditions. Nothing herein constitutes legal advice or creates a lawyer-client relationship. Users should consult qualified counsel for advice on specific matters or jurisdictions.