If you were injured in a motor vehicle accident that someone else’s reckless or careless actions caused, one of the most important factors in your ability to obtain compensation for the expenses and impacts you have incurred as a result of the injury is how much insurance the at-fault party has.
The reason for this is that insurance is the primary means by which most personal injury claims are paid. However, not all insurance policies are created the same. How much compensation you receive for your injuries also depends on whether the individual has combined single-limit insurance or a split-limit policy.
Read on for more information about one type of commercial auto insurance—combined single limit insurance—and how it differs from split limit policies and; more importantly, what it means for the amount of compensation you receive.
Combined Single Limit Insurance
Combined single limit insurance is a form of auto liability insurance. Liability insurance is required in all states to drive a vehicle, and additional insurance is required for certain commercial industries, such as trucking. What liability insurance does is provide compensation to individuals that the insured driver causes harm through injury and property damage.
This insurance covers:
- All necessary medical expenses, including the cost of emergency treatment, transport to the hospital, diagnostic and laboratory testing, physician and surgical services, hospitalization, prescription medication, physical therapy, and rehabilitation, and the provision of assistive devices such as prosthetics, crutches, or a wheelchair.
- Lost wages resulting from being too injured to work.
- Loss of future earning capacity if the accident prevents you from returning to work or earning in the same capacity as you did before the accident.
- Property damage, such as the cost of repairing or replacing your vehicle.
- Physical and emotional pain and suffering resulting from the injury.
Combined Single Limit insurance policies—also known as CSL insurance or single limit policies—are a common type of automobile insurance policy that is often used by commercial businesses, such as trucking companies.
With a combined single limit, there is a maximum payout available and that payout can be used to compensate either bodily injury or property damage. Additionally, if the accident resulted in injuries to multiple parties, several individuals could divide the available insurance.
Combined single limit coverage tends to be broader but also tends to feature higher premiums than split limit policies. This is one of the chief reasons that a combined single limit policy generally involves commercial endeavors with a high amount of assets, rather than being the policy of choice for personal insurers.
How CSL Insurance Differs from Split Limit Insurance
While a combined single limit policy is a more modern approach to compensation after an accident, split limit policies are more popular and likely what you have more experience in dealing with. A split limit policy is what most individuals have for their personal vehicles.
When an individual has split limit liability insurance, you will generally see three numbers listed for the policy. These are the policy limits for bodily injury per person, bodily injury per accident, and property damage. For example, individuals who register their vehicles in Florida are required to have an auto insurance liability policy of at least 125/250/10. This is the split limit liability coverage you must have to drive on Florida roads.
What this means is:
- The policy has a maximum policy limit of $125,000 per person for bodily injury.
- There is a maximum $250,000 policy limit per accident for bodily injury.
- The policy provides up to $10,000 in property damage coverage per accident.
Let’s consider an example to see how each type of policy performs.
Let’s say an accident occurs and the holder of a split limit insurance policy with Florida’s minimum coverage levels is at fault. There were two people injured. One person had $90,000 in medical expenses and the other person’s medical expenses were $170,000. There was $9,000 in property damage sustained by a victim of the accident.
The $90,000 in medical expenses for the first victim would be covered as they fall beneath the bodily injury policy limit, as would the property damage as it fell below the property damage limit. However, the other victim sustained damages of $45,000 over the policy limit. Additionally, the amount of bodily injury costs per accident also exceeded the limit of the policy by $10,000. This results in thousands of dollars in uncovered costs.
With a CSL policy limit of $300,000, all the costs would be covered, as the medical expenses for both injured people and the cost of repairing or replacing the vehicle adds up to $269,000—which is within the policy limit.
The Advantages of CSL Insurance
Many times, the amount of medical expenses far outweigh the cost of the property damage that was sustained in the accident. However, with split limit liability coverage, only a certain amount will be available per person for expenses relating to the injuries that were incurred while the rest is allocated to property damage.
This can leave an individual with medical expenses over the amount of the policy limit that cannot be covered by any remaining amount allocated for property damage. In other words, you can’t obtain money for all of your medical expenses even if you did not max out the policy’s limits on property damage because of the split allocation of the money available.
Individuals with high-worth assets often find CSL insurance advantageous as well. With policy limits that are generally between $300,000 to $500,000, the policy is often considered worth the extra expense of the premiums as it provides less opportunity for expenses to go over the limit. Uncovered expenses fall on the driver or vehicle owner to cover, meaning CSL insurance can be a form of asset protection.
The Disadvantages of a Combined Single Limit
The most distinct disadvantage of dealing with an at-fault party who has CSL insurance occurs when the accident involves injuries to multiple people.
The combined single limit is the maximum amount of insurance available from the policy, regardless of how many individuals are injured, how severe the injuries are and how much property damage was sustained.
Often, CSL policies do not have a high enough limit to adequately compensate all the needs, meaning individuals will have to settle for an amount that is not truly representative of the expenses and impacts they have incurred and could leave the driver of the commercial vehicle facing personal responsibility for the uncovered damages.
How Does CSL Insurance Interact with PIP in Accident Claims?
As you are likely aware, drivers with vehicles registered in Florida are also required to purchase personal injury protection (PIP) policy of at least $10,000. This policy is designed to cover up to 80 percent of an individual’s medical expenses and 60 percent of lost wages resulting from the injury up to the limit of the policy.
As one of a handful of states that practices the no-fault insurance system, Florida only allows auto accident lawsuits to be filed in cases where an individual’s injury-related expenses exceed the limits of his or her policy or where the individual’s injury is severe enough to pass the state’s serious injury threshold.
Injuries that meet the threshold include those that:
- Result in a significant and permanent loss of an important bodily function;
- Permanent injury within a reasonable degree of medical probability;
- Significant and permanent scarring and disfigurement;
CSL insurance generally does not interact or impact your ability to obtain compensation through your PIP policy after an accident. If the at-fault party in your case has CSL insurance, it becomes a factor only if you are permitted to file a personal injury claim against the individual for injuries that qualify based on seriousness, or injuries in which the expenses have exceeded the limits of your PIP policy.
Is There a Way to Obtain CSL-Level Coverage From a Single Limit Policy?
Many individuals replicate the level of coverage provided through a CSL insurance policy by paying for a split limit policy and adding on an umbrella policy that provides additional coverage in certain types of accidents. However, others prefer the CSL policy as it keeps all the money in one pot and all of the available coverages in one policy.
Why are CSL Insurance Policies Common With Trucking Companies?
As explained by Progressive’s Commercial Insurance Division, trucking companies are federally required by the division that oversees the industry—the Federal Motor Carrier Safety Administration (FMCSA) to carry a CSL policy with a limit of $750,000.
Those who require a federal filing must have a CSL insurance policy of at least $1,000,000. Companies that require a federal filing include those that engage in interstate transport, hauling hazardous materials, those that engage in for-hire trucking, and those engaging in for-hire passenger transportation.
Companies with multiple trucks must maintain the same liability coverage on one truck as they do on all other trucks in the fleet.
The Bottom Line
If you found yourself in an accident and are confused by the other party’s insurance coverage or even your own PIP insurance policy, a truck accident lawyer can explain it to you. A car accident attorney can investigate, determine which insurance companies are liable for your losses, and pursue compensation for you, whether it’s a PIP, CSL, or split limit insurance policy, and even if more than one liable party owes you damages.
At our law firm, we can help you understand combined single limit policies, split limit coverage, PIP insurance, and more. Don’t wade through the aftermath of an accident alone. Call us today!