underinsured motorist Archives

What Does it Mean to Stack Insurance Coverage

What does it mean to stack insurance coverage in a Louisville area injury accident under Kentucky or Indiana Law? Kentucky law allows stacking of uninsured and underinsured motorist benefits depending upon how the insurance policy is written. Indiana does not allow insurance policies to be stacked.

Simply put, stacking refers to recovering insurance polices from more than one applicable policy. In other words, you have $25,000 of uninsured motorist coverage on your Volvo, Chevrolet and your motorcycle. Stacking would say that you have $75,000 of coverage because you have 3 policies of insurance with $25,000 on each policy.

By stacking coverage from more than one car or motorcycle insurance policy the injured party can increase the total amount of his recovery, assuming the value of his claim is worth more than the just the initial insurance policy.

For example, if you own three vehicles: a Buick, a Toyota and a Ford Truck. On all three of these vehicles, you made sure you put $100,000 of underinsured motorist coverage on each automobile policy. Well stacking means that since you effectively bought three $100,000 policies of underinsured motorist coverage, you have $300,000 of underinsured motorist benefits available to you; even though you were only in one of your vehicles at the time of the accident.

Insurance companies are not fond of stacking because it ultimately means that they may have to pay out more money to settle your personal injury claim. As a result, they have now written most insurance policies so that stacking does not occur. They do this by making it so that you have one policy of insurance that covers you no matter which vehicle you are riding in at the time of the wreck.

Now, let me explain to you how this concept can work when dealing with a car wreck. I had a gentlemen approach me about a case wherein his first medical bill was $22,000 and the at-fault driver was only insured for $25,000. I looked at the automobile policy and there was no underinsured motorist coverage on his Toyota. Nevertheless, we were able to get my client’s underinsured motorist coverage from his other automobile insurance that covered his Cadillac.

Very simply, to avoid stacking, his insurance company wrote the underinsured coverage so that it would apply regardless of the vehicle he was operating. In this case, it meant we had an additional $25,000 in insurance coverage we could go after.

Is it possible to stack insurance coverage in your situation, and how would that affect the amount of money you receive? I would need to see your whole policy and see how your benefits are defined therein. As a result, I suggest you contact me at (502) 609-7657 and we discuss this matter further.

Motorcycle Wreck in Indiana: Some immediate legal issues to address.

I had a phone call the other day in regard to a motorcycle wreck that happened in Corydon, Indiana. While I had about a thirty-minute phone call with the injured motorcyclist, I have not signed him up as a client yet. Nevertheless, I wanted to share with you some of the issues that are immediately present for motorcycle accidents, or car wrecks, occurring in Indiana.

First, in Indiana, drivers are only required to insurance coverage of at least $25,000 per person or $50,000 per wreck. As a result, when the motorcyclist told me had been hospitalized for several days following the wreck, I was immediately concerned as to whether the at-fault driver had enough insurance coverage just to satisfy his medical bills, much less his claim for pain and suffering.

Second, I told him to immediately reserve any med-pay coverage he has on his motorcycle insurance. In short, if the hospital bill is $40,000 and he only had $10,000 in med-pay, I don’t want the hospital to grab the $10,000 in med-pay and still assert a claim for a $30,000 unpaid balance. While it does not always happen this way, I would try to get the hospital bill paid by the health insurance carrier for the motorcyclist. This way, the $40,000 bill will hopefully be reduced to 30% to 50% of the original billed amount, $12,000 to $20,000. While the health insurance has a right to recover what they paid from the personal injury settlement (known as a subrogation claim), I want to use that $10,000 in med-pay to satisfy the health’s subrogation claim that in theory would much less. In essence, we have taken a dollar bill and stretched the heck out of it. By doing so, we have potentially decreased the amount of medical bills that have to be paid out of the motorcyclist’s recovery and consequently, increased the amount recovered by the motorcyclist for his pain and suffering claim.

Further, we immediately began to talk about underinsured motorist coverage on both his motorcycle and his automobile insurance. While typically automobile insurance carriers have policy provisions that exclude injuries that occur while riding a motorcycle, you have to check all possible sources of recovery when it appears that the value of the personal injury claim may exceed the available insurance coverage. The problem with underinsured motorist coverage in Indiana is that the motorcycle rider can only collect underinsured motorist coverage to the extent the at-fault driver does not have as much insurance coverage as you do. In other words, if the at-fault driver has $50,000 in insurance coverage and the injured motorcyclist has $100,000 of underinsured motorist coverage, your personal injury settlement would consist of $50,000 in recovery from the at-fault driver and $50,000 of underinsured motorist coverage. So even though you think you paid for $100,000 of underinsured motorist coverage on your own insurance policy, you find out that you can only make a claim for half that amount. This is a great example of how the law is not fair.

Lastly, I told the motorcyclist to make sure he fully considered the attorney’s fee he would owe in this matter. If an attorney charges him a 33.33% attorney’s fee, it could end up that the attorney fee’s might be $33,333 and yet because of the medical bills, the client might recover less than that amount. In my office we have an unwritten policy that prevents this from happening in non-litigation cases. However, whether it is through a reduced attorney’s fee up front or a policy favoring the client in regard to the reduction of the medical expenses, this is a consideration the motorcyclist has to consider when evaluating who to hire as a personal injury lawyer.

Tag: underinsured motorist