Stacking Coverage
Stacking coverage refers to the ability for an individual to combine or 'stack' the uninsured/underinsured motorist coverage limits from multiple insurance policies they hold.
Example #1
For example, if a person has two vehicles insured under separate policies with $25,000 in uninsured motorist coverage each, with stacking coverage, they may be able to combine the coverage limits to effectively have $50,000 in protection if they are involved in an accident with an uninsured driver.
Example #2
Another example would be if a person is a passenger in a friend's car and is hit by an uninsured driver. If that person has stacking coverage on their own policy, they can use their own policy's coverage limits in addition to any coverage available from the friend's policy.
Misuse
Misuse of stacking coverage could occur if someone tries to fraudulently claim benefits by manipulating the stacking process to inflate the amount of coverage available beyond what is legitimate. This is important to protect against because it could lead to increased premiums for all policyholders and undermine the fairness of the insurance system.
Benefits
The benefit of stacking coverage is that it provides additional protection in situations where the at-fault party does not have insurance or sufficient coverage. This can be crucial in covering medical expenses and damages resulting from accidents with uninsured or underinsured drivers.
Conclusion
In line with CAP's mission of empowering consumers, stacking coverage can offer enhanced security for individuals facing financial losses due to accidents with uninsured or underinsured motorists. It's essential to understand the proper use of stacking to prevent abuse and ensure fair treatment within the insurance system.