Car accidents can be incredibly challenging. When you’ve been in an accident and are left dealing with injuries, property damage, and emotional stress, it can become even more frustrating when you discover that the at-fault driver doesn’t have insurance to cover your losses. Unfortunately, this situation is all too common in the state of Florida, where a significant number of drivers are either uninsured or underinsured.
Let’s delve into this issue and explore the concept of stacked and non-stacked insurance to help you better protect yourself on Florida’s roadways.
Florida’s Insurance Requirements
Car insurance in Florida is meant to provide financial protection in the event of an accident. The state’s car insurance system relies on two key components:
- Property Damage (PD) Insurance: This covers the cost of damage to the other party’s property when you’re at fault in an accident. However, it doesn’t cover your own vehicle or property damage.
- Personal Injury Protection (PIP) Insurance: This pays for medical expenses and lost wages for you and your passengers, regardless of who’s at fault in the accident.
Florida law requires all drivers to carry a minimum of $10,000 in both PD and PIP insurance. However, these minimums often prove insufficient to cover the costs of a serious accident.
The Challenge of Car Insurance in Florida
The predicament for many Floridians lies in the inadequacy of PIP coverage. The reality is that $10,000 often falls significantly short, especially when confronted with medical expenses and vehicle repairs. A single ambulance ride or emergency room visit could deplete your entire coverage. Additionally, PIP, intended to cover lost wages, might also drain quickly when combined with medical bills, depending on your income level.
While PD and PIP insurance are mandatory in Florida, they often don’t provide comprehensive coverage for all the expenses associated with an accident. This can leave you in a precarious financial situation if you’re in a severe accident with an uninsured or underinsured motorist.
What Is Uninsured Motorist Coverage?
In Florida, uninsured motorist coverage is not mandatory, and drivers can formally decline this coverage. However, insurance providers must extend the option of a minimum of $10,000 in uninsured motorist bodily injury coverage per person.
Uninsured Motorist Coverage (UM) acts as a safeguard in situations where you’ve been struck by a motorist lacking bodily injury coverage or with insufficient coverage. With this coverage, if an uninsured driver causes an accident, your own insurance company will assume responsibility for your damages up to the limits defined in your policy. You can also benefit from UM coverage in accidents with underinsured drivers, where the at-fault driver’s insurance doesn’t fully cover your expenses.
Suppose your medical bills surpass $10,000, and you need to initiate a claim against the driver at fault. If the driver lacks bodily injury liability insurance or carries insufficient coverage, your Underinsured Motorist (UIM) policy will step in, covering your medical costs, pain and suffering, and lost income up to the policy’s maximum limits.
What Is Stacked Insurance?
Stacked insurance, sometimes referred to as “stacking,” is an option that allows you to combine or “stack” the uninsured/underinsured motorist (UM/UIM) coverage limits for multiple vehicles on your policy. In simple terms, it can increase the amount of coverage available to you when you’re involved in an accident with an uninsured or underinsured driver.
Examples of Stacking
Let’s explore how stacking can work with a practical example. Suppose you have two vehicles on your insurance policy, each with uninsured motorist coverage limits of $50,000 per person and $150,000 per accident. If you choose stacked insurance, you can effectively double your coverage to $100,000 per person and $300,000 per accident. In the event of an accident with an uninsured motorist, you could claim up to $100,000 per person and $300,000 per accident to cover your medical expenses, lost wages, and other damages.
Benefits of Stacking Insurance
Stacking your insurance offers several advantages:
- Increased Coverage: Stacked insurance provides higher UM/UIM coverage limits, which can better protect you from financial hardship in the aftermath of an accident. It can also cover accident expenses that non-stacked insurance would not cover, such as accidents on a secondary vehicle or motorcycle you own.
- Comprehensive Protection: It helps bridge the gap when the at-fault driver doesn’t have enough insurance to cover your losses.
- Cost-Efficient: Stacked insurance is often more affordable than purchasing separate UM/UIM policies for each vehicle.
What Is Unstacked Insurance?
Unstacked insurance, sometimes called “non-stacked” insurance, means that your UM/UIM coverage limits apply only to the specific vehicle involved in the accident. In the same example mentioned earlier, if you had unstacked insurance on both vehicles with $50,000 per person and $150,000 per accident limits, you would be limited to a maximum payout of $50,000 per person and $150,000 per accident, even if you had two vehicles insured.
Do You Need Stacked Insurance?
Whether you need stacked insurance depends on your individual circumstances, including your financial situation and the number of vehicles in your household. Stacked insurance is particularly beneficial for those who have multiple vehicles on the same policy or those with minimal savings or assets to cover accident-related expenses.
Take note, however, that there is a higher rate of accidents caused by uninsured or underinsured drivers in Florida. A recent report from the Insurance Research Council unveiled alarming statistics: approximately 12.6% of all vehicles in the United States were uninsured, translating to one in eight vehicles. Florida’s estimate was even higher, with 20.9% of vehicles lacking insurance coverage.
To protect your financial well-being and peace of mind in light of these, having stacked insurance in Florida may be well worth it.
Other Insurance Coverages
In addition to UM/UIM coverage and stacking options, you may want to consider other insurance coverages to enhance your protection, including:
- Collision Coverage: This covers the costs associated with the repair of your vehicle resulting from an accident involving another vehicle or object.
- Comprehensive Coverage: This particular type of coverage caters to expenses linked to damage to your vehicle from circumstances beyond collisions. These include occurrences like theft, vandalism, and damage due to adverse weather conditions.
- Medical Payments Coverage (MedPay): This can help cover medical expenses not included in your PIP insurance. In Florida, this insurance is not mandatory, but it can be advantageous if you lack health coverage or contend with a substantial deductible.
- Roadside Assistance: This coverage takes care of towing and other services following a breakdown or accident.
- Gap Insurance: This coverage bridges the gap between what you owe on your vehicle and its actual cash value in the event it’s totaled in an accident.
Understanding the differences between stacked and unstacked insurance and the various coverage options available is vital when navigating Florida’s unique insurance landscape.
Ultimately, the goal is to ensure that you’re adequately protected on Florida’s roadways, no matter who you encounter, so you can move forward with confidence and peace of mind. If you have questions about your insurance coverage or need assistance with a personal injury claim, don’t hesitate to reach out to our experienced team at Robinson & Casey. Your well-being is our top priority.
