South Carolina Personal Lines Practice Exam

What type of liability limit applies to total damages for bodily injury and property damage from one accident?

1. Per-accident limit

2. Combined Single limit

3. Aggregate limit

4. Split limit

The correct answer is: Combined Single limit

The combined single limit is a type of liability insurance coverage that provides a single maximum limit for both bodily injury and property damage resulting from an accident. This means that the insurer will pay up to the specified limit for all claims arising from a single accident, regardless of whether those claims involve injuries to individuals or damage to property. By having a combined single limit, the policyholder has the flexibility to utilize the total limit for any combination of bodily injury and property damage without being bound to separate limits. This can be advantageous in accidents where there are substantial damages, as it allows for a streamlined claim process and potential for a more efficient allocation of coverage in the aftermath of an incident. The other types of limits differ in structure; for example, per-accident limits set maximum amounts for each individual accident but do not combine claims for bodily injury and property damage. Aggregate limits refer to the total coverage amount for a policy period, and split limits establish separate coverage amounts for bodily injury and property damage, which can complicate the claims process in certain situations.