Is there a maximum number of policies that you can create in WatchGuard? Or Can you create as many polices as you want?
The policy limit will be in your feature key.
-In policy manager go to setup -> feature key
-in WebUI go to System -> Feature Key
For most modern Fireboxes, this will be unlimited. For older firewalls, there may be a limit.
Each firewall can only hold a finite amount of things in memory. Trying to load 10,000 policies on a Firebox T10 that also has all subscription services running will probably run the device out of memory.
With that in mind, it's not uncommon to see firewalls with 100 or so policies, and support runs into customers with a few hundred from time to time.
Finally, keep in mind that the more policies you have the more difficult it will be to keep track of them all. Should you need a large number of policies, I'd suggest looking into policy tagging.
WatchGuard Customer Support
The Feature Key for my T35w shows Firewall Policies Maximum = Unlimited
"Trying to load 10,000 policies on a Firebox T10 that also has all subscription services running will probably run the device out of memory."
Ha, ha, ha! Running a T10 with 21 policies and all UTM runs it out of memory enough that upgrading from 12.5 to 12.5 Update 1 took FIVE reboots before catching the magic windows to upgrade without getting a low memory error.
Fireware 12.5.1 build 601804
WSM 12.5.1 build 601717
ISP = Spectrum Cable 100 x 10 service
Management computers: Win 8.1 Pro 64-bit, Win 10 Pro 64-bit, Server 2012 R2