Are you concerned about the possibility of getting into an accident with an uninsured driver? If so, auto insurance stacking is a way that you can pay extra for your insurance in order to limit your risk in the event that your car is damaged or your person is injured in a collision with an uninsured driver.
The number of uninsured drivers in the U.S. has been decreasing over the past decade or so, but the number of uninsured drivers remains fairly high. Around 12 percent of drivers are uninsured, meaning that around one out of every ten cars on the road are being driven by drivers lacking insurance.
Given that so many drivers are uninsured, drivers can seek to increase their personal coverage through the idea of stacking insurance. Stacking insurance is either prohibited or restricted in a number of states, but of you live in an area in which stacking is permitted, it might be worth looking into if you’re concerned about getting into an accident with an uninsured driver.
What is Insurance Stacking?
In short, stacking multiplies your underinsured and insured limits from the number of automobiles on your policy. As a result, you’ll be given more protection from your policy or policies if you end up in an accident with a driver who is either underinsured or uninsured.
Insurance stacking comes in one of two forms.
The Two Types of Insurance Stacking
Insurance Stacking Across the Policy
In this form of insurance stacking, you would have multiple different policies for multiple different automobiles. If you choose the stacking option, you’d be able to file claims with each of the policies in the event of an accident involving an uninsured or underinsured driver.
An example of ‘Across Policy’ stacking would be: Two cars, each insured under different policies. If you end up getting into in an accident with one of those cars involving an uninsured or underinsured driver, the stacking would allow you to file a claim not only with the policy associated with the car, but also with the policy associated with the other car.
Insurance Stacking Within the Policy
In this form of insurance stacking, you would have one insurance policy covering multiple cars. If you go with the stacking option, you’d be able to collect coverage for accidents involving an uninsured or underinsured driver across all cars covered by the policy.
An example of ‘Within Policy’ stacking would be: Two cars, both insured by the same policy. If you end up in an accident with one of those cars involving an uninsured or underinsured driver, the stacking would allow you to combine the coverage limits of both cars, rather than just the one involved with the accident.
Additional Advantages of Insurance Stacking
The most obvious benefit of insurance stacking is simple: If you end up in an accident with an uninsured or underinsured motorist, your policy or policies will pay you out more money. However, there is an additional benefits to stacking.
If you have a stacked policy or policies, you’ll be given additional protection in the event that someone tries to sue you in the aftermath of a car accident. If you’re worried about legal liability and its cost to you, stacking provides some defense and financial protection.
While insurance stacking can be quite beneficial, the practice is limited or banned in the majority of the U.S. Insurance companies generally fight for increased permission to offer stacking, arguing that it leads to increased payouts for its customers. However, many states are so far unswayed by this argument.
Currently, the following 19 states allow for stacking:
- Rhode Island
- West Virginia
If you’re a resident of one of these states, you should note that restrictions and regulations vary in terms of stacking options. Both state laws and insurance laws set the rules for stacking, and these policies may change as time goes on.