Glossary > Insurance > Auto Insurance > Uninsured

Stacking

Stacking in the context of auto insurance, specifically uninsured/underinsured motorist coverage, refers to the practice of combining or 'stacking' multiple policies to increase the coverage limits available to an insured individual in the event of an accident caused by an uninsured or underinsured driver.

Example #1

For example, if an individual has two cars insured with separate policies and chooses to stack their uninsured/underinsured motorist coverage, they can potentially double the coverage limits available for each vehicle to provide greater protection in case of an accident.

Example #2

Another example is when a family has multiple vehicles insured and opts to stack their uninsured/underinsured motorist coverage across all policies, allowing them to pool the coverage limits and receive higher financial protection for all family members involved in an accident.

Misuse

Misuse of stacking may occur when an individual tries to exploit the system by fraudulently stacking policies from different households or misrepresenting the number of vehicles insured to access higher coverage limits. This misuse can lead to increased insurance costs for all consumers as insurers may raise premiums to offset fraudulent stacking practices. It is crucial to prevent misuse to maintain fairness and affordability within the insurance marketplace.

Benefits

The benefit of stacking is that it provides an additional layer of financial protection for insured individuals and their families in case of accidents involving uninsured or underinsured drivers. By stacking coverage limits, individuals can ensure they have sufficient funds available to cover medical expenses, vehicle repairs, and other damages resulting from the accident.

Conclusion

Stacking is a valuable strategy for consumers to enhance their protection against uninsured/underinsured motorists. Still, it must be used ethically and within legal boundaries to prevent misuse that could negatively impact insurance costs for everyone. By understanding the benefits of stacking and using it responsibly, consumers can leverage this option to safeguard their financial well-being in unfortunate situations.

Last Modified: 4/29/2024