Some direct carriers are spending millions of dollars advertising that you can save a bundle of money if you place your auto insurance with their company.   Liability insurance is not required in the State of Florida to place your vehicle on the road; if they do not inform you of this fact, ask if they are working for you, or working for the insurance company. They do not want you to know the importance of stacked uninsured/underinsured motorist coverage (UM/UIM), in an amount equal to your bodily injury coverage. They certainly will not tell you that you can purchase a $1,000,000 excess liability policy, commonly known as an “umbrella policy,” with an endorsement for Uninsured Motorist Coverage.

Some insurance agents may tell you that you do not need this coverage, or that you do not need much of it. If they do, ask if they are working for you or working for the insurance company. The insurance company may want you to have less UM, non-stacked, so the carriers can save on claims, thereby being able to offer less expensive premiums. It’s more likely that a careful driver will be a victim of a bad driver. Yes, they will provide an umbrella policy for you, but they will probably not tell you to add UM to that policy. Once again, ask if they are working for you or working for the insurance company.

With the exception of swimming in shark infested waters, with heavy rip tides, practically nothing is more dangerous than driving in the State of Florida. 

Let me first explain that Geckos are small lizards famous for their ability to walk up walls, and other sheer vertical surfaces and to hang from ceilings. Another carrier talks about receiving a premium refund every six months when claim free, and another on the set of a national monument while being told that the first accident may not cause you an additional premium. These are all distractions designed to lead you in the wrong direction.

Upon applying for automobile coverage you have several options to choose from:

Option A- provides for Uninsured Motorist Coverage limits EQUAL to your bodily injury liability limits either Stacked or Non-Stacked.

Option B- provides for Uninsured Motorist Coverage limits LESS THAN your bodily injury limits whether you choose stacked or non-stacked.

Option C- Rejects Uninsured Motorist Coverage.

After making a selection you must sign confirming that there was an informed knowing acceptance of the selections made on behalf of all insureds. Remember that the Florida statute is clear that if the policy holder does not sign an election/rejection form at the inception of the policy, the UM coverage is issued at a limit equal to the bodily injury limits on a stacked basis.

As of May 6, 2018, there were 21, 414,154 total vehicles registered in the State of Florida; 15, 365,419 consisting of autos and pickups. According to the Insurance Information Institute “26.7% of the registered vehicles have NO INSURANCE.” Plus, many millions have inadequate limits in the event of serious injuries or death. 

The “Florida No-Fault Law” does not require bodily injury liability coverage; it only requires $10,000 PIP, and $10,000 Property Damage coverage to obtain license plates. Therefore, involvement in an accident with an uninsured vehicle, or one that has inadequate liability insurance can be a likelihood. Uninsured Motorist Coverage also includes Underinsured Motorist Coverage.

WHAT TRIGGERS AN UNINSURED MOTORIST CLAIM? 

This coverage is for your protection, other occupants, and for the family members of your household, in the event of a motor vehicle accident that is caused by the negligence of another driver. You can be operating your own vehicle, be a passenger in another auto, ride a bike, be a pedestrian, or sitting at an outdoor restaurant when a vehicle mounts the sidewalk and injures you. You must have sustained (a) significant and permanent loss of an important bodily function; (b) permanent injury with a reasonable degree of medical probability, other than scarring or disfigurement; (c) significant and permanent scarring or disfigurement; or (d) death. These criteria will allow you to sue for “Pain and Suffering”, inconvenience, loss of opportunity to enjoy life, loss of the companionship of family members, loss of services, emotional or psychological distress, death, disability, permanent injuries, dismemberment and all special damages, such as medical bills, wage loss, future wages, diminution in earning potential, and all other out-of-pocket expenses. In order to activate this coverage the other vehicle has to be uninsured, or a vehicle that leaves the scene of the accident.

AN EXAMPLE OF UNDERINSURED MOTORIST COVERAGE. 

You, or a passenger in your vehicle, are involved in an auto accident; very seriously injured, and which is caused by another driver’s negligence that carries liability coverage of $100/300,000. Through arbitration you have been awarded $1,200,000 for your pain and suffering, your permanent injuries, your wage loss, your diminution in earning potential, and all other out-of-pocket expenses. After collecting $100,000 from the other vehicle’s insurance policy, you may then be able to collect the balance from your own insurance policy. That is if you have the proper limits of coverage, i.e., $250/500,000 UM for your auto policy, and an umbrella with $1,000,000 UM/UIM.

It is important to note that your PIP coverage will initially pay for your medical bills up to the limit of $10,000. If you have Medical Payments coverage it will pick up after the PIP is exhausted. UM/UIM coverage will become effective after these benefits have run out. Please note that PIP is primary against all other forms of medical and disability insurance coverage, except Worker Compensation benefits.

WHAT IS STACKED UNINSURED MOTORIST COVERAGE? 

Stacking UM/UIM provides for additional UM/UIM benefits for each vehicle on the policy that has this coverage. For example, if you carry $250/500,000 coverage and you have three (3) vehicles on the stacked UM policy, then you will have $750/1,500,000 in UM/UIM coverage under which to make a claim.

COVERAGE SIMILARITIES-STACKED AND NON-STACKED 

  • “An insured” for UM/UIM includes the person named, the resident spouse, and related persons who are residents in the household, such as children. (Persons occupying your covered auto are also an insured for UM/UIM coverage).
  • Both forms allow an insured to collect UM/UIM coverage while occupying an auto that they own and is insured.
  • Both forms allow an insured to collect while they are occupying an auto not owned by them. For example, a resident spouse rents a car or borrows a friend’s car and is injured by an uninsured motorist.
  • Both forms respond out of state.
  • Both forms respond if an insured is on a business errand or in a vehicle owned by their employer.
  • Both forms respond for an insured who is occupying a non-owned motorcycle.
  • Both forms allow an insured to collect UM/UIM benefits if they are struck as a pedestrian by an uninsured motorist. 

Therefore, both the stacked and the non-stacked UM/UIM forms provide coverage which is “portable” meaning it follows a policyholder into non-owned vehicles and as a pedestrian.

COVERAGE DIFFERENCES 

Besides a pure dollar difference, there is a significant coverage difference between the two forms which could affect whether you or your family members can collect under the UM/UIM provision of the policy. At times the stacked form will respond for a claim whereas the non-stacked form will not.

WHEN STACKED UM/UIM RESPONDS BUT NON-STACKED DOES NOT. 

  • The policy holder obtains a second vehicle and does not call to report the vehicle within the allowable reporting period of 14 to 30 days after purchase (depending on the particular form). Two months later, he or she is hurt while occupying that new vehicle, injured by an uninsured motorist. Stacked coverage responds while the non-stacked does not.
  • The policy holder owns a clunker; a vehicle that is not licensed and is used a few times a year to haul material to the county dump a few blocks away. The policy holder decides to take advantage of the Cash for Clunkers Program, and on the way to the dealership, a collision occurs with an uninsured motorist, and the policy holder is injured. Stacked coverage responds while the non-stacked form does not.
  • The policy holder is a “snowbird” who insures one vehicle in Florida under non-stacked UM/UIM, and owns another vehicle up north. He is in the northern vehicle and is injured by an uninsured motorist. Unless he has UM/UIM up north, the Florida policy with stacked coverage responds while non-stacked does not.
  • The policy holder owns a motorcycle, insures it separately under a motorcycle policy, and has rejected UM/UIM under the motorcycle policy due to the high cost. In addition, the policy holder owns a car insured on a personal auto policy. While on the motorcycle he is injured by an uninsured motorist. With stacked UM/UIM on the auto policy UM/UIM responds for the injury sustained while occupying the motorcycle; non-stacked UM/UIM would not respond.

TO SUMMARISE 

When an insurance agent suggests that you take less UM/UIM than your Bodily Injury Limits, they are recommending that you insure strangers for a considerably larger amount than what you have established to protect yourself, and the loved ones that travel with you. If you can afford to cover strangers, then you can afford to adequately insure yourself, your family and your friends. Can you imagine the grief and terror that a family must feel when an automobile accident causes the occupants to suffer serious injuries that render them unable to work and earn a living? One of the greatest misconceptions that people have is that it always happens to the other person……never to them. But, to the other person….you’re the other person!

You cannot be “penny wise and pound foolish” when it comes to protecting your financial well-being. Think of stacked UM/UIM as purchasing an additional insurance policy for the uninsured or underinsured driver that fails to provide for your well-being.   When the limits of your bodily injury and UM/UIM are $250/500,000 you become eligible for an umbrella policy; you can then add an additional $1,000,000 in UM/UIM coverage which is very reasonable.

By representing a variety of the nation’s leading insurance providers, The Oyer, Macoviak & Associates Group is able to customize a strategy that not only maximizes benefits and protection, but takes into careful consideration the financial concerns of each individual client. Their licensed service representatives have the expertise to provide valuable guidance in this area, and take pride in recommending the type of protection that will most benefit the client. Unlike the direct writers that are exclusive to one carrier; they have a depth of resources and a total commitment to providing the right protection and coverage in keeping with the immediate and long range needs of its clients.

Your family depends upon the decision maker to make the determination to protect the lifestyle and financial welfare for all concerned. You will never have to ask us if we work for you, or work for the insurance company! Don’t wait another day with inadequate auto coverage. Please call The Oyer, Macoviak & Associates at (561) 732-9305 or call me, Jack Lesser, on my cell at (561) 573-6034.

Author’s Note: Some portions of this article contains copyrighted information, which has been reprinted through the kind permission of the Florida Association of Insurance Agents. Please be advised that the information provided is for educational and /or informational purposes only. The material contained herein does not constitute legal advice, which only a licensed attorney can provide.

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