When you are the victim in a car accident and struggling to receive the money you are owed, something that isn’t always talked about is insurance stacking. Stacking is a pro-consumer, pro-victim law that’s only available in a few states, and we happen to be lucky that South Carolina is one of them. But what exactly is policy stacking, and how can it benefit you when you’ve been in an accident?
First, let’s talk about some car accident statistics so that you can get a sense of why insurance stacking is so useful.
South Carolina Accident Statistics
South Carolina Department of Public Safety (SCDPS) statistics from 2014 show that here in our beloved Palmetto State, someone was hurt in a car accident about every fifteen minutes. That’s over 34,000 injury accidents over the course of the year. Meanwhile, the Insurance Information Institute’s (III) latest numbers puts the nationwide average number of uninsured drivers at nearly 13% as of 2012.
Victims in many of those accidents will have a very hard time receiving compensation from the drivers responsible. Even worse, what those numbers don’t reflect is how many drivers are under-insured, when existing insurance coverage isn’t enough to cover the costs of the accident. Many drivers only carry insurance at the state’s legally required minimum level, which may not even be enough to cover the cost of the vehicle, let alone medical bills and other costs.
Both underinsured and uninsured drivers put the financial burden on the victim of an accident. It is in these situations when policy stacking can really make a difference. Stacking can help victims receive greater compensation not only for medical bills and property damage, but also for future medical and rehabilitation costs, lost wages or reduced earning capacity, mental anguish, and other unforeseeable expenses related to the accident.
So how does stacking help so much? The answer is more straightforward than you might think.
Stacking Lets You Use Multiple Policies
Simply put, being able to stack policies means that you can file claims against underinsured or uninsured motorist policies that you or another family member in the same household have, even if the policies cover vehicles that were not involved in the accident. This stems in part from the fact that South Carolina law mandates insurance actually follows the policyholder, not just the specific vehicle. In other words, our great state lets you potentially use all of the policies that you are eligible for, not just one. There are a few simple rules to follow, but it’s a powerful tool that many other states won’t let victims have at all.
Underinsured Policy Stacking
In order to stack underinsured policy (UIM) claims, you must first have UIM coverage on the vehicle involved in the accident. UIM is not required by law, so check with your insurance agent if you’re unsure of whether or not you have this type of coverage, and consider purchasing coverage if you do not already have it.
If you have UIM coverage and the at-fault driver’s liability insurance has already been maxed out on your claim, you may then begin to “stack” by filing claims on other valid policies (as described in the previous section), up to the maximum amount of UIM coverage on the vehicle involved in the accident, per policy.
For example, if you have $25,000 of UIM coverage on your vehicle that was struck, and the other driver has $25,000 in liability coverage, you are only eligible for up to $50,000 in coverage. But if you and your spouse have two other cars at home, each with their own UIM policies, you may also be able to make claims against those policies for up to $25,000 each, too. That would make you eligible for up to $100,000 of coverage—double the amount of coverage that you had without stacking.
Uninsured Policy Stacking
When struck by a motorist who is uninsured (or in hit-and-run cases when the other driver cannot be located) you can also stack uninsured motorist (UM) coverage, subject to similar restrictions as UIM stacking. Your primary UM coverage must first be exhausted before you can use other policies. The same restriction on how much you may claim for each stacked policy applies, and you may stack using the policies of family members or relatives you share a residence with, too.
Ask Your Attorney for Help With Stacking Your Policies
Stacking insurance is a tool that can help victims of car accidents more fully recover financially from an accident by being able to make a claim against every insurance policy they are eligible for. The rules may seem a little complex, but your attorney can help you figure out what policies you may be able to stack so that you can begin the process of getting your life back.
If you have any questions about stacking your policies, it would be our pleasure to talk to you about your situation. Call us at our Columbia offices for a free case evaluation at 803-790-2800, or use our online contact form. We look forward to helping you every way we can.