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The "bodily injury limit" for your policy is the maximum that you can receive from your insurance policy for charges incurred due to bodily injury in an accident.
If you were to damage state or private property and were found at fault for an accident, this is the maximum amount your policy would pay out.
If you were involved in an accident with a motorist without insurance and were found at fault, this is the maximum amount your policy would pay out for the uninsured motorist.
If you were involved in an accident with a motorist who is underinsured and were found at fault, this is the maximum amount your policy would pay out for the underinsured motorist.