Stacked vs. Non-Stacked Uninsured Motorist Coverage in Florida

Stacked or non-stacked uninsured motorist coverage in Florida? The short answer

One definition will help as you read. Uninsured motorist coverage, written UM and sometimes UM/UIM, responds to your own injuries and your family’s when the driver who hurt you has no bodily injury coverage (uninsured) or has less than your losses (underinsured). In Florida the two are one coverage on the policy.

What uninsured motorist coverage does, beside PIP and bodily injury liability

Three coverages on a Florida auto policy deal with injuries, and they are easy to confuse because they are bought on the same page.

Uninsured motorist, PIP and bodily injury liability: three coverages that are easy to confuse

UM steps into the place of the coverage the other driver should have carried. It does not pay the other driver, and it does not replace your own liability coverage.

PIP is the no-fault layer and it is small; our page on how much car insurance you need in Florida covers its 80 percent and 60 percent rules and the emergency-medical-condition limit. Bodily injury liability protects other people from you. Uninsured motorist coverage is the one that protects you from other people, and because Florida does not require most drivers to carry bodily injury coverage, it is the one that does the most work in a serious Florida crash. It is designed to respond to medical bills above PIP, lost wages, future care, and the pain and disability a serious injury leaves behind, according to the policy’s terms and up to the limit you elect.

Stacked versus non-stacked: the differences that matter in a claim

Stacking is the question of whether the UM limits on a multi-car policy add together. Florida is the state that made stacking famous, because its statute issues UM on a stacked basis unless you sign a separate form choosing non-stacked, and because the non-stacked version comes with specific limitations the statute allows. The table below puts the two side by side.

Stacked and non-stacked uninsured motorist coverage, side by side

Every line responds according to the policy’s own terms and the limits you elect. The statute sets what carriers may and must offer; the policy form sets how a claim is handled.

The limitations on non-stacked coverage come from section 627.727(9) of the Florida Statutes, which lets a carrier provide, when you accept the non-stacked offer, that the coverage on two or more cars is not added together, that the UM available to you when you are hurt in one of your cars is the UM on that car, that in a car you do not own the highest single-car limit responds as excess, that as a pedestrian one car’s limit responds, and that no UM applies when you or a resident relative are hurt in a vehicle you own that is not insured for UM under the policy. Those limitations are what the 20 percent saving buys.

The industry’s education material on this coverage draws a line between the dollar difference and the coverage difference, and the coverage difference is the one that turns a saving into a denial. Both forms follow you into a borrowed car, a rental car and onto the sidewalk, so portability is not what separates them. The separation is the non-stacked form’s exclusion for an owned vehicle not insured for UM under the policy, and the claims that run into it look ordinary: a replacement car that was not added to the policy inside the carrier’s window; a snowbird’s second car up north where UM was rejected; a motorcycle insured on its own policy without UM; a new spouse’s car where UM was rejected before the wedding; a car jointly titled to you and your business and insured on a commercial policy; an antique car insured elsewhere at a low UM limit. In each of those the stacked form can respond, according to the policy’s terms,, because it has no such exclusion, and the non-stacked form does not. A Florida appeals court reached the same conclusion in 2006, in a class action brought by a one-car policyholder who wanted her stacked premium back: stacked coverage provides benefits even with one automobile, because the statute’s limitations do not apply to it, in Collins v. GEICO, decided by Florida’s Third District Court of Appeal in 2006.

Households whose cars sit on separate policies run into the same rule from the other side. Stacked UM on each policy combines across them, so four cars on four policies each carrying 100/300 stacked add up to 400/1,200 for the household, while rejecting UM on all but one policy leaves that one limit for everyone. A household that keeps an old truck on liability only has no UM at all when someone is hurt riding in it on a non-stacked policy, and that is the kind of detail we go through with you before the form is signed. If your cars are split between Florida and another state, our second home and snowbird insurance page covers where each car and the umbrella are written.

The motorcycle question: does stacked UM on the car policy reach a bike with no UM?

This is the most common uninsured motorist question riders ask, and it has a two-part answer. If the car policy carries stacked uninsured motorist coverage, it responds to your injuries while you are on a motorcycle you own, even when the motorcycle policy carries no UM at all. If the car policy carries non-stacked coverage, it does not.

The reason is the exclusion described above. Section 627.727(9) of the Florida Statutes lets a carrier write the non-stacked form so that it provides no UM to you or a resident relative while occupying any vehicle you own that is not insured for UM under that policy, and a motorcycle you own with UM rejected on its own policy is that vehicle. The stacked form carries no such exclusion, and neither form excludes a vehicle because it has fewer than four wheels, so a stacked car policy follows the rider onto the bike. The industry’s education material works it through in three steps: one car with stacked 100/300 responds on the owned motorcycle at 100/300; two cars with stacked 100/300 respond at 200/600; the same household with non-stacked coverage collects nothing from the car policy on the bike. One agency’s experience in that material ended in an E&O settlement over this gap, a non-stacked car policy beside a motorcycle policy with UM rejected.

The answer to the next question is just as important. Riders sometimes ask whether they can stack the car policy and reject UM on the motorcycle policy to save the premium, which is high on a bike. We recommend against it, and we recommend UM on the motorcycle policy at limits equal to its bodily injury limits, stacked, with the car policy stacked too. With both policies stacked the limits combine across them, so a rider with 100/300 stacked on two cars and 100/300 stacked on the bike has 300/900 on the bike, in the cars, in a borrowed car and on foot, according to the forms; with UM on the car policy alone the rider has only the car policy’s limit on the bike, and a motorcycle crash is the one most likely to use all of it. Our Florida motorcycle insurance page covers the rest of a rider’s policy, including why PIP does not apply to motorcycles at all.

Stacking on one car: why the stacked form still matters when there is nothing to stack

Households with one car ask the fair question: why pay more for stacked coverage when there is no second car to stack? The answer is that stacking is the smaller of the two differences between the forms. Both forms are portable. Each follows you into a borrowed car, a rental car and onto the sidewalk, so the one-car household is not choosing between coverage that travels and coverage that does not. What the one-car household chooses is whether the policy carries the non-stacked form’s exclusion for a vehicle you own that is not insured for UM under it.

That exclusion reaches more one-car households than the label suggests, because most households own more vehicles than they realize and insure them in more places than one policy. The claims the industry’s education material describes are ordinary: a replacement car bought on a Saturday and not added to the policy inside the carrier’s window; a second car kept up north with UM rejected on its own policy; a motorcycle insured separately without UM; a new spouse’s car where UM was rejected before the wedding; a car jointly titled to you and your business and insured on a commercial policy; a car jointly owned with an adult child and insured on the child’s policy at a low UM limit; an antique car insured elsewhere; the old car kept for sale after the plate moved to the new one. In each of those, a stacked one-car policy can respond at its full limit, according to the policy’s terms, and a non-stacked one-car policy responds with nothing, because the vehicle was owned and not insured for UM under the policy.

Florida’s courts have looked at this from the other direction. In 2006 a policyholder who owned one car brought a class action to recover the extra premium she had paid for stacked coverage, arguing that with one car she got nothing for it. The Third District Court of Appeal disagreed in Collins v. GEICO: the statute’s limitations in section 627.727(9)(a) through (e) apply to the non-stacked form, and when the insured buys stacked coverage those limitations do not apply, so the higher premium bought a real benefit even with one automobile. The same statute also says a carrier may offer the non-stacked form; it does not have to, and if no election form is signed the policy is issued stacked at the bodily injury limits.

Two practical points close the question. On a one-car policy the premium difference between the forms is usually small in dollars, which is why the industry’s guidance is to quote stacked at the bodily injury limits regardless of the number of vehicles. And the moment a one-car household becomes a two-vehicle household, whether by a purchase, a marriage, a motorcycle or a car kept in another state, the exclusion is already in force on a non-stacked policy, and the election carries forward at renewal until someone changes it. We recommend the stacked form on one car for the same reason we recommend it on three: the coverage is protecting your own household, and the cases where it matters are the ones nobody planned for.

The election form: what Florida law requires the carrier to offer

Florida law does not require you to carry uninsured motorist coverage, but it does require the carrier to offer it and to make you say no in writing. Under section 627.727(1), a policy that carries bodily injury liability must provide UM at limits equal to the bodily injury limits unless you reject it or select lower limits on a form approved by the state. The form carries a bold heading warning that you are electing not to purchase valuable coverage that protects you and your family, or are buying less of it than your liability limits, and a signed form is treated as a knowing rejection. If no form is signed, the policy is issued with UM at the bodily injury limits, stacked.

Non-stacked coverage is a second election. Under the same statute the carrier may offer the non-stacked version only with a separate form that explains the limitations, and it must price that version at least 20 percent below the stacked one. Two practical points follow. The forms are signed when the policy starts and generally carry forward at renewal, so a choice made years ago is still the choice in force today; and the rejection is per policy, so a household with two auto policies has two elections. This is not a page for downloading the form; the carrier provides its approved version, and we go through it with you before you sign.

Three household illustrations of how the limits combine

Three illustrations show how the versions differ in practice. Each one is an illustration only, subject to the policy form and the limits you elect, and none of them describes how any particular claim would be handled.

Illustration one: two cars, both at 100/300 UM

A household insures two cars and elects UM at 100/300 on each. With stacked coverage, the per-person limit available to an injured family member is $200,000 and the per-accident limit is $600,000, because the two cars’ limits combine. With non-stacked coverage, the limit available is one car’s, $100,000 per person and $300,000 per accident, and if the family member was hurt in one of the two cars, it is that car’s limit that applies.

Illustration two: one car, hurt in a second car that was never added

A household insures one car with UM at 100/300, buys a second car, and does not add it to the policy inside the carrier’s replacement window. Weeks later a family member is hurt in the second car by a driver with no bodily injury coverage. With non-stacked coverage, the form’s exclusion for a vehicle the household owns that is not insured for UM under the policy applies, and no UM responds. With stacked coverage there is no such exclusion, and the 100/300 limit responds according to the form. The same pattern reaches a spouse’s car where UM was rejected and a motorcycle insured elsewhere without UM.

Illustration three: three cars, one on liability only

A household insures three cars and keeps the oldest on liability only with no UM. On a stacked policy, the UM limits on the two insured cars combine, and whether the coverage reaches a family member hurt in the third car depends on the form’s terms. On a non-stacked policy, the statute allows the carrier to provide that no UM is available for anyone hurt in the third car, because it is a car the household owns that is not insured for UM under the policy. Households in this position usually add UM to every car they own or accept the gap knowingly.

Do you need UM if you have good health insurance?

This is the question we hear most, and the honest answer is that health insurance and uninsured motorist coverage are built for different losses. Health insurance responds to medical bills according to its own deductibles, co-insurance and networks, and it stops at the bills. Uninsured motorist coverage is designed to respond to the rest of what a serious crash takes: lost wages while you cannot work, future care and equipment, the cost of help at home, and the pain and disability that follow, according to the policy’s terms and up to the limit you elect. A household with excellent health coverage and a stable income still has the income to lose and the years to live with the injury, which is why we recommend UM at limits equal to bodily injury on nearly every policy we place.

There is also a timing point. Health plans that pay crash-related bills often assert a right to be repaid from any injury settlement, so the medical bills you thought your health plan absorbed may come back out of a recovery. UM limits give that recovery room to exist. Our page on who needs an umbrella looks at the same question from above the auto policy.

The layer above: uninsured motorist coverage on the umbrella

Uninsured motorist coverage ends at the auto policy’s limit unless it is carried on the umbrella too. A personal umbrella adds liability above the home and auto limits, and most umbrella carriers offer an uninsured motorist endorsement on it that adds UM above the auto policy’s UM limit, in the same steps as the umbrella itself. Without the endorsement, an umbrella protects other people from you and does nothing for your own family above the auto policy’s UM. We recommend the endorsement on every umbrella we place, and there is no formula for the amount; it is set with the umbrella limit itself. Our umbrella insurance page explains how that limit is chosen, our umbrella cost page covers what moves the price, and our excess liability page explains the form difference that matters if the umbrella carrier writes excess instead.

How to choose, and when to revisit the choice

The choice comes down to four questions, and we work through them with every household.

• How many cars are on the policy, and does every one of them carry UM. Two or more cars with UM is the case stacking was written for; a car kept on liability only is the case the non-stacked limitations reach.
• Which vehicles the household owns that are not on this policy, including a car insured in another state, a motorcycle or a car a spouse insures separately, because the non-stacked form has no UM for you in an owned vehicle that is not insured for UM under the policy and the stacked form does.
• What the household earns and expects to earn, because UM is the coverage that responds to lost income after a crash caused by someone with no coverage.
• What the 20 percent difference is in dollars on your policy, because on many policies it is small enough that the stacked form is the plain choice and on some it is not.

The election carries forward at renewal, so we recommend revisiting it whenever the household changes: a car added or dropped, a teen licensed, a parent moving in, an umbrella bought. Our page on who has to be on a Florida car insurance policy lists those moments. Working with you, we price the coverage both ways on the same limits and compare 6+ carriers, so the line item is a decision rather than a surprise on the declarations page.