Return To: Business Insurance – The Ultimate Guide Hired autos are vehicles that are leased, rented, or borrowed by businesses or their employees for commercial
Combined Single Limit Liability (CSL)
Most poeple understand how personal auto insurance works! While there are many similarities, one big difference comes with how MOST Business Auto Liability Carriers assign liability insurance.
In Personal Car Insurance, liability is split between Bodily Injury & Property Damage. Commercial Auto Insurance combines both Property Damage & Bodily Injury into one single limit.
While it is one single limit, it is important to understand what both types of liability cover.
Bodily Injury Liablity
Bodily Injury Liability coverage will pay for damages to other people’s property as a result of an accident caused by you or another covered driver.
Here are some examples of damages covered under the Bodily Injury Liability of your policy:
- Medical Expenses
- Law suit settlements & Legal Fees
So What Limits Do I Need? That is the question that only you can answer with the help of you Agent. When speaking with customers, this is a story that is often used at ALLCHOICE.
You are involved in an accident (which is your fault). You ran a stop light and struck another car that contained three (3) people.
All three people were injured and taken to the hospital. The driver suffered numerous injuries, including a broken arm.
The other passengers all sustained minor injuries. It is possible that North Carolina’s minimum Bodily Injury Limits would pay for the hospital bills (lets assume they did).
However, the driver (who suffered a broken arm) just happens to be Brain Surgeon!!! How much would a simple month away from his occupation cost in terms of lost wages? Are those minimum liability limits still sufficient?
Property Damage Liability
Property Damage Liability will pay for damages to other people’s property as a result of an accident that is caused by you or another covered driver. Here are some examples of damages covered under the Property Damage Liability of your policy.
- Vehicle Repair
- Vehicle Actual Cash Value
- Damage to other Real Property
So What Limits Do I Need? That is the question that can only be answered by you with the help of your agent.
Let’s continue with our same hypothetical accident from “Bodily Injury”. The Brain Surgeon that you hit was driving a NEW Mercedes CLS550 (Sticker Price $70,000 +). North Carolina requires you carry a minimum of $25,000 Property Damage Liability. That leaves a very large shortfall ($70,000 – $25,000 = $45,000) between what your insurance will pay for and what you will have to pay “out of pocket”!
Are those minimum liability limits still sufficient?