Combined Single Limit
What Does Combined Single Limit Mean?
A combined single limit is a provision in an insurance policy that specifies that coverage for all aspects of a claim is capped at a single amount. This means that whether the claim involves property damage, injury to other individuals, or other related expenses, the single limit applies to the total payout for the claim. This type of limit is commonly found in property insurance policies.
Insuranceopedia Explains Combined Single Limit
In contrast, split limit coverage specifies different maximum amounts allocated to various components of an insurance claim. For instance, while a combined single limit policy might have a cap of $300,000 per claim, a split limit policy could have limits of $80,000 per person for bodily injuries, $50,000 for property damage, and a maximum of $300,000 per claim. This means that if an insured individual files a claim for $200,000 in damages due to injuries, they would receive the full $200,000 from the combined limit policy but only $80,000 from the split limit policy. Consequently, the combined limit policy offers more comprehensive coverage overall, which typically results in higher costs. This trade-off matters most when you are working out how much liability insurance you actually need. To supplement a split or combined limit policy, purchasing an umbrella policy may be a wise choice to protect against significant risks. For business owners, a commercial umbrella policy pays claims that go above the underlying CSL.
