What Is Stacked Insurance Coverage?

Last Updated on June 3, 2022

When shopping for car insurance, you’re going to come across many new terms and concepts. One of these is the concept of stacking your insurance coverage. There are a few different ways that you can stack your insurance coverage to increase your potential payout in the event you need to make a claim. Here’s how stacked insurance coverage works and why you might consider it for your car insurance.

stacked insurance coverage explained

What Is Stacked Car Insurance?

Stacked car insurance allows you to increase your underinsured/uninsured motorist coverage if you have more than one car. This type of coverage will pay for car repairs and medical bills if you are hit by someone who doesn’t have any car insurance or doesn’t have enough liability coverage to cover the damages. This type of coverage varies slightly between states, and some states allow you to stack your coverage while others don’t.

How Can I Stack Within a Policy?

If you insure more than one car on your insurance policy, it’s straightforward to stack your coverage. For example, if you have two vehicles on your policy and they each have $20,000 in underinsured motorist coverage, you could get up to $40,000 in coverage if one car is hit. If this is something you’re interested in, be sure to ask your car insurance agent if they offer this option, as stacking isn’t guaranteed with every policy.

How Can I Stack Across Policies?

Many customers are aware that you can stack your coverage within a policy, but what many people don’t realize is that you can actually stack your coverage across policies as well. If you have two separate policies with the same insurer for two different cars, you can actually combine the underinsured motorist coverage if the need arises. This is more complex than stacking within a policy, so talk to your insurance agent to make sure you understand how this option works with your insurer.

Why Should I Stack My Coverage?

If you’re going to be insuring multiple cars anyway, it’s always helpful to think about stacking your coverage. Stacked coverage can essentially help you get around your state’s liability coverage limits for added financial protection in the event of a car crash. While it is slightly more expensive to add on additional uninsured motorist coverage, it will give you peace of mind while you’re out on the road. It will also prevent a serious crash from being financially devastating because you’ll have much more flexibility with your insurance.

Is There Any Reason Not to Stack My Coverage?

The only reason to consider leaving your coverage unstacked is if you are on a tight budget. Stacking your coverage is typically going to make your insurance premiums slightly higher than they would be otherwise. However, if you do get into an accident with an underinsured motorist, those higher premiums are going to essentially pay for themselves. If you are considering stacked coverage but are concerned about the cost, ask your insurance provider for a quote. You should also make sure to compare different insurance providers and look for discounts to make sure you’re getting the best rates possible. Insurance costs can vary dramatically between insurance providers and customers as well. This is why it’s so important to look at several different providers when choosing an insurer, particularly if you’re looking to stack coverage or put any other add-ons on your policy.

What Are the Regulations Surrounding Stacked Coverage?

Some states require you to have underinsured motorist coverage, while others don’t. While adding this coverage to your policy will increase your overall premiums, the additional cost is relatively low. Some states do not allow you to stack your coverage, so you’ll want to check to see if this option is allowed in your state before you start shopping. You should also keep in mind that even if stacking is permitted where you live, not all providers will allow it. Be sure to read your policy thoroughly and look out for the phrase ‘anti-stacking provision,’ which means you won’t be allowed to stack your policies.

There are many benefits to stacking your insurance coverage if you have multiple cars. If multiple people in your household drive, it may benefit all of you to put your vehicles on the same policy so you can stack the coverage in the event of an emergency. Not only will you get extra protection, but your rates may be cheaper if you all split the cost of one policy instead of having your own. Be sure to look up your state’s laws regarding stacking, as they vary from place to place. For example, some states allow all stacking, some only allow stacking within a policy, and others don’t allow stacking at all.

James Shaffer
James Shaffer James Shaffer is a writer for InsurancePanda.com and a well-seasoned auto insurance industry veteran. He has a deep knowledge of insurance rules and regulations and is passionate about helping drivers save money on auto insurance. He is responsible for researching and writing about anything auto insurance-related. He holds a bachelor's degree from Bentley University and his work has been quoted by NBC News, CNN, and The Washington Post.
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