When it comes to auto insurance, you have a choice to purchase Combined Single Limits (CSL) or a Split Limit liability policy. Which one offers better coverage?
Combined Single Limit Liability Coverage (CSL)
This type of auto insurance coverage is a combination of all the liability limits (Bodily injury AND Property Damage). There is not a split differential between the three main components. A combined single limit is exactly what the name implies; liability is combined into one single limit. So if you purchase a $300 CSL policy, your policy will cover up to $300,000 total for any bodily injury or property damage.
Split Limit Liability Coverage
A Split Limit Liability auto policy is split into three parts:
- Bodily Injury Per Person
- Total Bodily Injuries Per Accident
- Property Damage.
An example of a standard Split Limit policy may look like this: 100/300/100. In this example, if you caused an accident, the maximum limit your insurance company will pay for Bodily Injury is: $100,000 limit per person, max $300,000 per accident, and up to $100,000 for any property damage (i.e., cars, buildings, fences you hit).
Let’s look how these two different auto policies would pay in the following example:
Let’s say you miss a stop sign and cause an accident where two people are hurt. The first person sustains $180,000 in Bodily Injury losses. The second person sustains $20,000 in Bodily Injury losses. Bodily injury could be medical costs and lost wages. In addition, the other driver’s auto was destroyed- a $40,000 loss.
If you have a Split Limit Policy of 100/300/100:
- Your policy would only cover the first person’s injuries up to $100,000 in Bodily Injury. Because there is still $80,000 left unpaid, the injured party can turn around and sue you for the $80,000.
- The second injured person will be covered in full at $20,000. (You have up to 100,000 per person and no more than 300,000 for all parties hurt).
- You have up to 100,000 in property damage, so the $40,000 for the car is covered by your insurance.
- In this case, the auto insurance limits selected leave you unprotected by $80,000.
If you have a Combined Single Limit (CSL) of 300,000, in the example above, you should have enough coverage in place for all losses. Why? Because your policy will cover up to $300,000 “combined” for all losses (bodily injury and property damage). In this case, the policy would pay $180,000 + $20,000 for both Bodily Injuries AND $40,000 for property damage—a total of $240,000 of the 300,000 your CSL policy limit allows.
The CSL type of auto policy does provide a greater level of protection and will cost a little more in premium. However, if you have an Umbrella policy, you may find increasing the liability coverage on your auto policy will lower the cost of your Umbrella policy, thus optimizing savings over both policies.
Each company is different on how they lower rates or increase rates. The number of cars and youthful drivers (teen drivers & under 25) in the household may factor in too…..so check with your insurance advisor to see how you can structure your auto coverage to meet your Umbrella liability requirements so you can optimize the savings accordingly.
With today’s litigious society, it is important to have as much liability coverage as you can fit into your budget. High health care costs, monetary and punitive damages, and attorney fees tend to cost insurance companies thousands, and sometimes, millions of dollars. How much do you want your insurance company to pay if you’re held liable? How much do you want to pay?
Miss that stop sign? Didn’t see the child while backing up? Youthful driver texting while driving? Anything can happen. Accidents can happen. Avoid potential costly lawsuits from inadequate auto coverage by getting the right coverage in place.
If you would like us to review your insurance coverage and see how we can lower rates and optimize savings, give our office a call today at 610-376-7300, contact us at or fill out the form on our contact page. We are here to help you!
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