Stacked vs. Non-Stacked Car Insurance: Which Is Best for You?

Stacked vs. Non-Stacked Car Insurance: Which Is Best for You?

Uninsured and underinsured motorist coverage will help pay for your costs if you are ever involved in a car accident with someone who has little to no insurance. If you have stacked auto insurance, you can combine the coverage limits of multiple policies or multiple vehicles to get more coverage in the event you are injured in an accident with a driver who has insufficient coverage.

stacked insurance is primarily available with coverage for uninsured or underinsured motorists. Some states prohibit or limit stack insurance coverage, and even if it’s allowed in your state, your insurer may not offer it.

Learn about stacked vs. non-stacked auto insurance so you can get the most out of your coverage options.

Stacked vs. Non-Stacked Auto Insurance

Uninsured and underinsured auto insurance policies are stacked or unstacked. Stacked coverage combines the coverage limits of multiple policies or vehicles. With non-stacking insurance, you are only covered up to the amount stated on your insurance policy.

How does stacked car insurance work?

Uninsured and underinsured coverage for motorists (UM or UIM, respectively) provides personal injury coverage for medical bills and property damage coverage for repair or replacement of your vehicle. To use UIM or UM coverage, the underinsured or uninsured driver must be at fault. This cover also applies if you are the victim of a driving accident.

Uninsured motorist coverage helps to cover accidents where the other, guilty driver does not have insurance. An underinsured motorist applies if the other driver is not sufficiently insured to cover your medical expenses. For example, the other driver may only have minimal state liability coverage with relatively low limits.

However, stacked insurance only applies to personal injury coverage on your uninsured and underinsured auto insurance, not property damage. So you may be able to combine coverage limits to pay medical bills, but not for repairs or replacement of your vehicle in the event of an accident.

Your coverage can be “stacked” in two ways:

  • Stack vertically: Combines the coverage of two or more vehicles on the same policy. So if you have three cars on one policy, each with $50,000 UM/UIM personal injury coverage, you can get up to $150,000 covered by stacking your coverage.

  • Stack horizontally: Combines the coverage of multiple auto insurance policies from the same insurance company within the same household. For example, if you have $50,000 coverage on your UM/UIM policy and your spouse also has $50,000 coverage, you can make claims on both policies for up to $100,000 total coverage.

Typically, stacked insurance will cost more than non-stacked insurance because it offers higher insurance limits.

Depending on your state, you may not be able to get stacked insurance, or you may be limited in the type of stacked insurance coverage you can use. Stack insurance is allowed in 32 US states, and 10 of those states only allow horizontal stacking of policies.

Here is a list of the states that allow insurance stacking:

How does unstacked car insurance work?

Non-stack auto insurance is the standard UM or UIM coverage you take on one vehicle. Coverage is not combined with other insurance policies you may have on other vehicles. You choose a certain level of coverage and if you have an accident and are not at fault, your insurer will pay out up to the amount for which you are covered.

For example, if you have $50,000 personal injury UM/UIM coverage, your insurance company will pay up to $50,000 on your medical bills if you have an accident with someone who is uninsured or underinsured.

Bodily injury claims can include medical expenses, pain and suffering, lost wages, and even funeral expenses, so costs can exceed $50,000, but non-stacked insurance only pays up to the threshold amount.

The advantage of non-stack auto insurance over a stacked policy is a less expensive premium. When you stack policies, you have to pay more for the higher amounts of cover.

What do both auto insurance options share?

Both stacked and non-stacked auto insurance policies are similar in that they provide UM or UIM coverage for personal injury. According to a 2021 study from the Insurance Research Council (IRC), one in eight drivers in the US is uninsuredso having UM/UIM insurance is important whether it is stacked or unstacked.

3 Key Differences Between Stacked and Non-Stacked Car Insurance

The differences between stacked and non-stacked auto insurance mainly lie in the amount of coverage, cost, and availability.

1. Coverage:

Stacked insurance offers more coverage because it combines the coverage you have for multiple cars or multiple policies. So if you have two cars on one policy, each with $50,000 coverage, stacking insurance on both cars would give you $100,000 in coverage. Non-stack insurance only pays out up to the $50,000 coverage limit for your vehicle.

2. Cost:

There are many Factors Affecting Auto Insurance Rates. Non-stack insurance is generally cheaper than stacked insurance because you get less coverage. Although you could save money on car insurance premiums with non-stacking insurance, you may be responsible for paying out-of-pocket accident-related costs beyond what your insurance covers.

3. National Availability

Non-stack insurance is available all over the US. On the other hand, stacked insurance is only offered in 32 states, and 10 of them only allow horizontal stacking when two or more insurance policies are combined. Also, your insurer may not offer stacked insurance, even if your state allows it.

Which car insurance should you choose?

If you own multiple vehicles or if other drivers in your home have auto insurance, then you may want the extra protection that stacking your insurance could provide.

When choosing between stacked or non-stacked insurance, first check that stacking is allowed in the state where you live and with the insurance company you use. If not, then you really have no choice but to take out a stacked auto insurance policy.

Certain restrictions may also be set in states that allow stacking. In Alabama, for example, you are limited to stacking up to three vehicles on one insurance policy. So it’s a good idea to check your state laws before getting quotes for a stacked insurance policy.

Since stacked insurance is only available with UM/UIM coverage, consider the cost of adding the additional coverage to your auto insurance policy if you don’t already have it. While most states require liability insurance, UM/UIM coverage is only required for drivers in 14 states.

Frequently Asked Questions

Is Stacked or Non-Stacked Car Insurance Better?

Whether stacked or unstacked auto insurance coverage is better depends on what you consider better. Stacked auto insurance can provide a higher level of coverage, but non-stacked insurance is cheaper.

Am I required to have stacked car insurance?

No, you don’t need to have stacked auto insurance. You may not live in a state that offers it or have an insurance provider that offers stacked insurance.

Will I get more protection with stacked or non-stacked car insurance?

Stacked car insurance offers more protection against high medical costs after an accident with an uninsured motorist because it combines the coverage of multiple vehicles or policies.

What it comes down to:

The cost of medical bills and time lost after an accident can be high, especially if the driver is at fault and is not insured. While uninsured and underinsured auto insurance can help you cover these costs, stacking insurance coverage from multiple vehicles or multiple policies can provide additional protection to ensure your accident medical bills are paid.

To find coverage that meets the needs of you and your family, check out our list of the best car insurance companies.

This article Stacked vs. Non-Stacked Car Insurance: Which Is Best for You? originally appeared on FinanceBuzz.