QUESTION: “Why should I carry stacked uninsured motorist (UM) coverage?”
Even with a single car policy, there is a coverage difference between the stacked form and non-stacked form of UM. This difference can affect whether you or your family members will be able to collect UM benefits. Florida statute 627.727(9) addresses UM coverage and the stacking/non-stacking issues.
Once a consumer has made the wise decision to include uninsured motorist (UM) coverage on their policy they will also be required to elect whether to stack that coverage.
This election must be completed on the form selecting UM coverage and is done at the time that the application for insurance is made. It may also be addressed after the policy is initially issued if the policyholder is making coverage changes at a later time.
Unfortunately many people have no understanding of the advantages offered by electing stacked UM coverage. Consumers need to educate themselves about the advantages that stacked UM coverage offers to them, often at a minimal increase in policy premium.
Remember too, the statute is clear that if the policyholder does not sign an election/rejection form at the inception of the policy, the UM coverage is issued at a limit equal to the bodily injury limits on a stacked basis.
Before looking at the differences in stacked and non-stacked UM, let’s look at the similarities.
- “An insured” for UM includes the person named, the resident spouse, and related persons who are reside in the household, such as children. (Persons occupying “your covered auto” are also “an insured” for UM coverage.)
- Both forms allow an insured to collect UM coverage while occupying an auto that they own and insure.
- Both forms allow an insured to collect while they are occupying an auto not owned by them. For example, a resident spouse rents a Hertz car or borrows a friend’s car and is injured by an uninsured motorist.
- Both forms respond out of state.
- Both forms respond if an insured is on a business errand or in a vehicle owned by their employer.
- Both forms respond for an insured who is occupying a non-owned motorcycle
- Both forms allow an insured to collect UM benefits if they are struck as a pedestrian by an uninsured motorist.
Thus, both the stacked and the non-stacked UM forms provide coverage, which is “portable”, meaning it follows a policy holder into non-owned vehicles and as a pedestrian.
The stacking provision, in its simplest and most basic form, states that a policy holder can take the UM available on each car that is owned and insured and “stack” it together to be used anywhere. On the other hand, non-stacking is much like “what you see is what you get,” meaning the UM limit you see on the declarations page is what you get, no matter how many cars you own and insure.
Besides a pure dollar difference, there is a significant coverage difference between the two forms which could affect whether you or your family members can collect under the UM provision of the policy. At times, the stacked form will respond for a claim whereas, the non-stacked form will not. The non-stacked form has an exclusion stating that the insured can’t collect UM while occupying a vehicle owned by the insured, but not covered for UM under the policy.
A typical non-stacked UM form has an exclusion that reads something like this:
A. We do not provide Uninsured Motorists Coverage for “bodily injury” sustained:
1. By an “insured” while “occupying” any motor vehicle owned by that “insured” which is not insured for this coverage under this policy. This includes a trailer of any type used with that vehicle.
When Stacked UM Responds but Non-stacked Coverage Does Not
- The policy holder obtains a second vehicle and does not call to report the vehicle within the allowable reporting period of 14 to 30 days after purchase (depending on the particular form). Two months later, he or she is hurt while occupying that new vehicle, injured by an uninsured motorist. Stacked coverage responds while the non-stacked does not.
- The policy holder owns a clunker, a vehicle that is not licensed and is used a few times a year to haul material to the county dump a few blocks away. The policy holder decides to take advantage of the Cash for Clunkers program, and on the way to the dealership, a collision occurs with an uninsured motorist, and the policy holder is injured. Stacked coverage responds while the non-stacked form does not.
- The policy holder is a “snowbird” who insures one vehicle in Florida under non-stacked UM and owns another vehicle up north. He is in the northern vehicle and is injured by an uninsured motorist. The Florida policy with stacked coverage responds while non-stacked does not.
- The policy holder owns a motorcycle, insures it separately under a motorcycle policy and has rejected UM under the motorcycle policy due to the high cost. In addition, the policy holder owns a car insured on a personal auto policy. While on the motorcycle, he is injured by an uninsured motorist. With stacked UM on the auto policy coverage responds for the injury sustained while occupying the motorcycle; non-stacked UM would not respond.
Hopefully this article has shown how, even with one car on a policy, the stacked UM form provides broader coverage than the non-stacked form. Each of the examples above shows how coverage is broader under the stacked form. To say that stacked UM benefits only those with more than one car is not correct.
Answering the Original Question
While it is true that many people may never face a situation in which stacked UM on a single car policy would respond and non-stacked would not, it’s critical to understand the coverage differences in the two forms. Stacked benefits always give the insured the benefit of the most, and broadest, uninsured motorist coverage.
ANSWER: There are two major differences in the stacked and non-stacked UM forms. One relates directly to how much money the client can collect. The other difference is whether the form responds or not. The stacked UM form will respond at times when the non-stacked UM form does not. Even on a policy with a single vehicle being insured, there is a difference in UM coverage.
If you have been injured in a Lakeland, Orlando, or Tampa wreck caused by someone else’s negligence, a Burnetti, P.A. car accident attorney can help explain uninsured motorist coverage and how it may affect your potential claim. Call 1-888-BURNETTI.