Split Limits Liability Coverage vs. Single Limit Liability Coverage

The level of split limits liability coverage you carry on your insurance policy could determine what kind of auto insurance coverage you have access to in the event of a serious accident. With a combined single limit insurance policy you choose only one liability coverage limit. In contrast, split limit policies allow a choice of three limits. A combined single limit policy differs from split limits liability coverage in that combined single limit coverage allows you one amount of coverage. You will be able to use this money as needed. A split limit policy allows you to split the insurance coverage amount.

In other words split limits liability coverage divides your insurance coverage into variable amounts of protection for bodily injury and/or property damage while a combined single limit policy allows you freedom to use the cover as you choose. So, is one better than the other? Both types of policies offer good protection as long as you ensure adequate coverage.

It is recommended that consumers have $300,000 or more of single limit coverage while split limits liability coverage should be broken down to the maximum insurance cover per person/per accident for bodily injury and property damage. Split limits liability coverage is usually quoted using three figures for example $300/$300/$100.

In general a combined single limit auto policy offers great flexibility as the coverage isn’t locked in as it is with split limits liability coverage. This means that they coverage can be used to deal with the real circumstances of an accident, not a predicted scenario. An important drawback of split limits liability coverage is that the division of coverage may not be adequate to meet the real-time needs of accident damages and you may not be properly covered.

However split limits liability coverage may still work for you if you ensure good coverage limits on your policy. That means setting adequate limits per person, per accident, and making sure you have sufficient property damage coverage.

Property damage coverage is critical when considering your split limits liability coverage. If you have damaged another driver’s vehicle you will need to be sure that your policy can take care of what could amount to thousands or even millions of dollars. If, for example you cause damage to several cars you may be stuck with a bill you can’t possibly pay. For this reason experts suggest carrying at least $100,000 of property damage cover. Split limits liability coverage is mandatory in some states so make sure you know if you need it.