Stack the Decks

A long time ago, before cell phones and television remotes, most of the states in the union had something called ‘stacking’ coverage.  As soon as it appeared, it disappeared from the majority of the states.


How it works

It only refers to the uninsured and underinsured motorist coverages. If stacking is selected then in the event of an accident with an uninsured or underinsured driver the coverages are ‘stacked’ in relation to the amount of cars on the policy.  This would only apply to named insured and resident relatives.  An example – a policy with uninsured or underinsured limits of $300,000 combined single limit that has two cars would give the insured $600,000 worth of coverage available.

Some insureds may see this as being over insured and some may not.  In the small remaining states it is still offered, it should be easy to walk in either at inception or mid-term and add or remove it to the policy.  But we live in a litigious time.

Returning the Form

In the state of Pennsylvania, every time an agent adds or replaces a vehicle, they have to complete a form.  They can select stacked or non-stacked.  This is a bit arduous for clients with a lot of cars.

This necessity is due to a lawsuit (of course) in which the insured had replaced a vehicle and since the agent did not obtain and updated form from the insured rejecting stacking coverage – the company had to give it (Shipps vs Phoenix 8/14/2012).  Many carriers writing in Pennsylvania have unsuccessfully tried to question and/or overthrow this decision.

In addition to selecting stacked or non-stacked, the insured has to also remember that uninsured and underinsured can be lower or equal to the bodily injury and property damage liability limits.  This is the same as in states like New Mexico or Georgia.

What makes Pennsylvania special here is that the uninsured and underinsured coverage limits do not have to match each other.

That’s right, uninsured can be 50/100 and underinsured can be 15/30.  Different limitations can exist on the same policy.  And the agent has to explain this and fill out a form every time a car is added.

It gets worse …

The prefilled form


To further the problem, some carriers will say they will not prefill the form.  Those carriers claim the state of Pennsylvania does not allow prefilled forms.  However, some carriers will allow the prefilled form.

Why this matters?  It’s hard enough to explain the coverage to the insured, but what if the carrier sends the insured the form directly?  They have no idea how to fill it out and/or fill it out incorrectly thereby ending up with the wrong coverage.

If the insured does not return the form – the insurance carrier automatically may change their coverage to stacking.  This increases the rate.  More confusion and irritation for the insured.

Make sure the insured understands this need at inception and at any renewal retention phone call.  It may save any misunderstandings or costly claims.

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