Understanding Combined Single Limit Auto Insurance Policies

Purchasing car insurance can be confusing especially when you start diving into the details of liability coverage limits endorsements, and provisions. One term that often leaves drivers scratching their heads is “combined single limit” or CSL. What exactly does this mean and how does it work?

In this comprehensive guide, I’ll explain everything you need to know about combined single limit auto insurance, including:

• The definition of a combined single limit policy
• How it differs from split limit coverage
• The advantages and disadvantages of CSL
• How to determine the right CSL limits
• Examples of CSL in action
• Tips for choosing the best liability limits

Let’s start at the beginning – what is a combined single limit on car insurance?

What Is A Combined Single Limit Auto Insurance Policy?

A combined single limit, or CSL, bundles all liability coverages under your auto policy into one limit, rather than splitting them up.

With a traditional split limit policy, you have:

• Per person bodily injury limit
• Per accident bodily injury limit
• Property damage liability limit

These are stated separately, such as “100/300/50” ($100,000 per person, $300,000 per accident, $50,000 property damage).

A CSL combines them all into one number, like $500,000. That single limit applies to any claim for bodily injury or property damage.

So a CSL policy simplifies your liability insurance and provides more flexibility in paying claims that involve both injuries and property damage.

How Does A Combined Single Limit Policy Work?

Here’s a basic example of how a combined single limit functions:

You have a CSL policy with a $500,000 limit. You’re involved in an at-fault accident that injures 3 people and damages 2 vehicles.

• Person A has $50,000 in medical bills
• Person B has $100,000 in medical bills
• Person C has $75,000 in medical bills
• Car 1 has $15,000 in repairs
• Car 2 has $20,000 in repairs

The total payout is $260,000 for injuries plus $35,000 in property damage. Your CSL policy would cover the full $295,000 in damages up to the $500,000 limit.

With split limits, paying this claim would be more complex because you’d have to factor in per person limits. But the CSL allows flexible payment from the single bucket of funds.

The Benefits Of A Combined Single Limit Policy

There are a few key advantages to choosing a combined single limit over split liability limits:

Simplicity – CSL bundles coverage into one straightforward limit rather than splitting hairs over per person and per accident caps. This streamlines the policy and claims process.

Versatility – With the single bucket of money, you have flexibility in how the limit is applied to injuries vs. property damage. There are no caps forcing payouts one way or the other.

Higher limits – CSL policies typically have higher liability limits available than split limits, providing more robust coverage.

No need for umbrella policy – If you have high enough CSL limits, you may not need a separate umbrella liability policy to cover gaps above your auto policy limits.

Potentially lower premiums – In some cases, a CSL policy can have lower premiums than an equivalent amount of split limit coverage. But not always, so compare quotes.

The Downsides Of A Combined Single Limit

The disadvantages of CSL policies include:

Higher minimum limits – The minimum liability limits required by states are higher for CSL than split limits. So you may pay more out of pocket.

Limits can be exhausted quickly – A single major accident could wipe out your entire limit, leaving you unprotected for the rest of the policy period.

Finding affordable high CSL limits can be difficult – Most standard auto policies top out around $500,000 for CSL coverage. For higher limits you may need to get a specialty policy, which can be more expensive.

Claims may take longer to settle – Insurers have to investigate every injury and property damage claim before determining payouts rather than settling each claim separately.

So it’s important to weigh the pros and cons when choosing between combined single limit and split liability limits.

How Much CSL Coverage Should You Get?

The minimum CSL insurance limits are set by your state. For example, in Florida the minimum CSL is $10,000 for property damage but $25,000 for injuries. So your minimum CSL would be $25,000.

However, it’s recommended to purchase higher limits than the bare minimums. Here are some guidelines on CSL amounts to consider:

• $100,000 – Basic higher limit for drivers with minimal assets at risk in a lawsuit.
• $250,000 – Recommended for average middle-class households with some assets.
• $500,000 – Better protection for upper-middle class households with significant assets.
• $1,000,000 – Ideal for affluent households and high net worth individuals. Provides robust coverage.

Ultimately your ideal CSL limit depends on your financial situation, risk tolerance, driving record, and liability concerns. An independent insurance agent can provide guidance.

And a personal umbrella policy can supplement your auto CSL coverage if you need liability limits above $500,000.

Real World Examples Of Combined Single Limits In Action

Here are some examples of how CSL coverage would apply in real accident claims and lawsuits:

• Rear-end collision – You’re liable for rear-ending another car. Repairs to their bumper cost $3,000. Your CSL pays up to the limit.

• Sideswipe while changing lanes – You hit a car in your blind spot. The other driver has $8,000 in medical bills for minor injuries. Your CSL covers up to policy limit.

• Failure to yield causes multi-car crash – You pull out and cause a 4-car pileup. Damages total $400,000. Your $250,000 CSL covers part of the claim. You pay rest.

• Driving recklessly causes severe injuries – Your reckless driving puts another driver in hospital with $750,000 in medical bills. Your $500,000 CSL applies but you are sued for excess.

• DUI driver causes death – Driving drunk, you kill someone. $1 million CSL covers wrongful death settlement up to policy limit. Your remaining assets are at risk.

These examples illustrate how having higher CSL limits can be crucial in serious accidents where damages exceed state minimums.

How To Choose The Right Liability Limits

Deciding between split limits vs combined single limits ultimately comes down to your specific situation and coverage needs. Here are some tips:

• Compare quotes for both types of policies. CSL is not always more expensive.

• Buy state minimum CSL if you have few assets and want minimum cost.

• Choose moderate CSL limits like 250/500 if you have some assets and want good coverage.

• Consider high 500/1000 CSL limits if you have significant assets to protect.

• Ask your agent for guidance based on your finances, risk factors, and concerns.

• Use umbrella insurance to supplement CSL if you need liability limits above $500,000.

• Re-evaluate your limits at each renewal as your profile and assets change over time.

The Bottom Line On Combined Single Limit Policies

The simple explanation is that CSL liability coverage consolidates all auto policy limits into one number, rather than splitting them up. This provides flexibility to pay claims as needed from a single pool of money.

CSL policies can make the claims process smoother, allow higher limits, and potentially reduce premiums. But you may need to purchase higher minimum limits than split coverages.

Understanding the pros, cons, and workings of combined single limits allows you to make smart decisions about your car insurance policy. Comparing CSL vs split limits on quotes equips you to choose the option that fits your budget and gives you peace of mind.