Which type of limits of liability specifies limits separately for different coverages?

The correct answer involves understanding how liability limits work within different insurance policies. Separate limits for different coverages are referred to as split limits. Split limits establish distinct maximum amounts that will be paid for specific types of coverage, typically expressed as separate figures for bodily injury and property damage. For example, a policy might provide a limit of $100,000 for bodily injury per person and $300,000 for total bodily injury per accident, along with a separate limit for property damage.

This structure allows for flexibility in how claims are handled, ensuring that different aspects of a covered loss are addressed according to the specific protections established in the policy. This separation is crucial for policyholders as it helps them understand the extent of their coverage for various liabilities, as opposed to other limit structures that may not provide distinct amounts for different coverage areas.

In contrast, aggregate limits refer to the maximum total amount the insurer will pay for all claims during a policy period, while single limits combine both bodily injury and property damage into one total limit. Combined limits also have elements of separation but are structured differently than split limits. Understanding these distinctions helps policyholders effectively evaluate their insurance coverage options.