Author:
Kevin | Category:
Auto, Coverages
Q. What is this “stacked” coverage all about?
A. Stacked coverage refers to Uninsured Motorist coverage. It does not apply to any other coverage on the policy. I’ve heard people think that “stacked” meant all of their coverage stacks. So first of all just remember that stacked or non-stacked only refers to uninsured motorist coverage or UM as we will call it.
The benefit of stacked UM is that you can take the limits from each vehicle on your policy and stack them together. I usually explain it like this. You take the limit of coverage on the policy and multiply it by the amount of vehicles on the policy. So if you have $10,000 per person and $20,000 per occurrence UM limits on a policy with 4 vehicles, the stacked coverage would provide $40,000 per person and $80,000 per occurrence no matter which vehicle you are in.
Now the most controversial part of this coverage is single vehicle policies. In a recent Florida third district court of appeals decision (Collins v. GEICO, 3/1/06) the court said, in part, the following:
It is true that stacked uninsured coverage enables the insured to stack the coverage for one owned automobile onto the coverage of another owned automobile. That is not the only benefit of stacked coverage. Even with one automobile, should the insured have an uninsured motorist claim, stacked coverage provides certain benefits above those received with non-stacked.
What is that benefit? Well if you are a passenger in someone else’s vehicle, it’s possible to stack your UM with theirs in some circumstances. Also if you own a vehicle which is registered and insured in another state, it is possible to stack your UM from the Florida auto policy with the out-of-state policy. If you own a motorcycle, it is possible that stacked UM could pay if you are injured by an uninsured driver while operating the motorcycle. When driving an owned vehicle insured separately on a business policy, it is possible to stack the UM from your personal auto policy.
I’ve only touched on a few examples but I hope this helps you to make a decision when selecting your uninsured motorist coverage. Don’t allow your insurance agent to make your decision for you. Your agent is there to help but he/she is not the one who will pay for your bad decision. Before I was in the insurance industry I was a teenager buying insurance for the first time. My agent at the time set up my policy and just said “sign here and here” and I left with no bodily injury liability (which we will descuss in another post) and no uninsured motorist coverage. Thankfully I was never in an accident during that time but if I had, I would have found that my agent sold me a pretty useless insurance policy.
I will say this one last thing, in my experience most people don’t have stacked UM. Choosing non-stacked UM can save you a few dollars but always remember that stacked UM is much better coverage. So at this point I just want to share my philosophy, “Plan for the worst and hope for the best.” A couple extra bucks per month can result in thousands of extra dollars at the time of an accident. Choosing non-stacked UM means your coverage will only apply to the specifically insured vehicle.
