What type of limit does a liability policy have that sets the total must pay for a single incident at $50,000?

The correct choice is indeed the per occurrence limit. This type of limit specifies the maximum amount that an insurance policy will pay for a given incident or event. In this scenario, a liability policy with a per occurrence limit of $50,000 means that for any single claim or incident, the insurer will cover up to $50,000 in damages or costs resulting from that event.

For example, if a policyholder is involved in an accident that leads to a liability claim, the insurance would cover costs resulting from that one incident, but only up to the specified limit of $50,000. This is critical in liability policies as it determines the financial exposure of both the insurer and the insured in the event of a claim.

In contrast, a combined single limit refers to a single dollar amount available to cover both bodily injury and property damage in any one incident, while an aggregate limit refers to the maximum amount a policy will pay for all claims during a specified period, often a year. A sub-limit applies to certain specific types of coverage within the overall policy, capping how much can be claimed on that specific aspect. These different types of limits serve distinct roles and are essential to understanding how insurance policies function.