Split Limit vs Combined Single Limit Policies | NJM

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What Are Split Limit and Combined Single Limit Policies?

Your auto insurance policy may cover your liability using a split limit or a combined single limit. The type of limit you have determines how much your insurance company will cover if you're responsible for bodily injury or property damage.

Insurance companies typically provide policyholders with the option to choose from different liability limit amounts. Insurance companies may offer split limit policies or combined single limit policies.

Infographic explaining Split Limit and Combined limit: Split Limit: 1 injury at $500,000, $250,000 limit per person, $250,000 out of pocket. Combined Limit: 1 injury at $500,000, $500,000 limit per person, $0 out of pocket

Combined Single Limit Policies

A combined single limit policy has one liability limit for all injuries or damage sustained in an accident.

Here's how it works:
You cause an accident that injures three people and damages the other vehicle.

Bodily Injury to the Other Driver +$50,000
Bodily Injury to the Other Driver's Passenger +$30,000
Bodily Injury to Your Passenger +$110,000
Property Damage to the Other Car +$20,000
Total Damages: =$210,000

Your combined single limit policy has one limit for each accident: in this example, $250,000.

Your Liability Limit $250,000
Total Damages -$210,000
Difference
Your liability insurance would cover the damages
without additional out of pocket expenses for you.
=$40,000

Split Limit Policies

A split limit policy has a lower limit that applies to each person injured and a larger limit that applies to each accident.

Here's how it works:

You cause an accident that injures three people and damages the other vehicle.

Under a split limit policy, up to three different liability limits could apply to this accident:

  1. A limit applied to each person injured: in this example, $100,000.
  2. A second limit applied per accident: $250,000.
  3. A third limit applied to property damage in each accident: $25,000.
Bodily Injury to the Other Driver +$50,000
Bodily Injury to the Other Driver's Passenger +$30,000
Bodily Injury to Your Passenger +$110,000
Property Damage to the Other Car +$20,000
Total Damages: =$210,000

One person had $110,000 in bodily injury damages.

Per-Person Liability Limit $100,000
Bodily Injury to Your Passenger -$110,000
Remainder
You would be personally responsible for this amount
=$10,000

With a split limit policy, it could seem like you have per-accident coverage for the full damages. However, your per-person limit could leave you with out of pocket costs.

Coverage for Bodily Injury to the Other Driver +$50,000
Coverage for Bodily Injury to the Other Driver’s Passenger +$30,000
Coverage for Bodily Injury to Your Passenger +$100,000
Coverage for Property Damage to the Other Car +$20,000
Your insurer will pay:
Your out of pocket cost:
=$200,000
= $10,000

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The information and descriptions on this site are general in nature. The coverage afforded for a particular loss depends on the specific facts and the terms, exclusions, and limits of the actual policy. Nothing on this site alters the terms or conditions of any policy, as the policy controls coverage. Coverage options, limits, discounts, deductibles, and other features are subject to underwriting criteria, state availability, and effective dates. Coverage provided and underwritten by NJM Insurance Company and its subsidiaries, 301 Sullivan Way, W. Trenton, NJ 08628.