Insurance Policies: The difference between 100/300/100 and $300,000
06-03-2014, 02:36 PM
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Insurance Policies: The difference between 100/300/100 and $300,000
Trying to get back to what I used to do often and that is write up short threads so that others can learn more about insurance, specifically marine insurance.
When obtaining marine insurance there are a couple things to note and be aware of when you're comparing your policy to another quote or shopping all together and faced with comparing all of the quotes. So, here it goes!
When it comes to purchasing liability coverage you have a couple options, most commonly, you have the option to purchase what is referred to as "split limit" coverage OR "combined single limit" coverage.
The best way to break that down into laymen's terms is this: Let's say we are comparing $100,000/$300,000/$100,000 (aka split limits) vs. $300,000 (aka combined single limit) as line items on quotes.
Split limit coverage - the insurance company dictates how much money can be used of your $300,000 on a per person and property damage basis. The limit of $300,000 is broken down further as follows:
$100,000 to pay for any bodily injury to any ONE person.
$300,000 is the total amount that the policy will pay in total
$100,000 in property damage
Under this scenario, if you are in an accident with 3 people on your boat, two of which are severely injured and have bodily injury claims in excess of $100,000 each, you will be responsible personally for any of the damages exceeding $100,000. So if person A's bodily injury is actually $190,000, you will be responsible for paying the person the $90,000. The insurance company will pay $100,000 of Person A's injuries. Person B has injuries are $300,000. Under this policy, the insurance company would pay $100,000 to Person B, you would pay $200,000 out of pocket. Most people think that under split limit coverage you actually have $300,000 in coverage, but unfortunately, you don't really. You would have had to have 3 people injured whose injuries do not exceed $100,000 per person for the policy to pay out the full aggregate of $300,000.
Under the combined single limit policy of $300,000, you wouldn't have the above stipulations. You have one pot of money to pay for bodily injury and/or property damage as necessary with no limit on any one person's injuries/damages.
Whenever possible, GO FOR THE COMBINED SINGLE LIMIT! This applies to your auto insurance too. The difference in premium to do so is negligible and you'll thank yourself in you ever find yourself in a situation on the water or on the road where you are the at fault party.....
Boat Safe all.
When obtaining marine insurance there are a couple things to note and be aware of when you're comparing your policy to another quote or shopping all together and faced with comparing all of the quotes. So, here it goes!
When it comes to purchasing liability coverage you have a couple options, most commonly, you have the option to purchase what is referred to as "split limit" coverage OR "combined single limit" coverage.
The best way to break that down into laymen's terms is this: Let's say we are comparing $100,000/$300,000/$100,000 (aka split limits) vs. $300,000 (aka combined single limit) as line items on quotes.
Split limit coverage - the insurance company dictates how much money can be used of your $300,000 on a per person and property damage basis. The limit of $300,000 is broken down further as follows:
$100,000 to pay for any bodily injury to any ONE person.
$300,000 is the total amount that the policy will pay in total
$100,000 in property damage
Under this scenario, if you are in an accident with 3 people on your boat, two of which are severely injured and have bodily injury claims in excess of $100,000 each, you will be responsible personally for any of the damages exceeding $100,000. So if person A's bodily injury is actually $190,000, you will be responsible for paying the person the $90,000. The insurance company will pay $100,000 of Person A's injuries. Person B has injuries are $300,000. Under this policy, the insurance company would pay $100,000 to Person B, you would pay $200,000 out of pocket. Most people think that under split limit coverage you actually have $300,000 in coverage, but unfortunately, you don't really. You would have had to have 3 people injured whose injuries do not exceed $100,000 per person for the policy to pay out the full aggregate of $300,000.
Under the combined single limit policy of $300,000, you wouldn't have the above stipulations. You have one pot of money to pay for bodily injury and/or property damage as necessary with no limit on any one person's injuries/damages.
Whenever possible, GO FOR THE COMBINED SINGLE LIMIT! This applies to your auto insurance too. The difference in premium to do so is negligible and you'll thank yourself in you ever find yourself in a situation on the water or on the road where you are the at fault party.....
Boat Safe all.
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