Stacking Insurance Policies: Protecting Yourself From Uninsured and Underinsured Motorists.

By: James Crytzer

According to the Insurance Research Council, more than 12 percent of drivers in Nevada are uninsured. Therefore, in order to protect you and your family, it is imperative that we all understand and consider what could happen to you or a loved one injured by an uninsured motorist. This article addresses one area for potential recovery in these unfortunate circumstances. While the guilty party may not have coverage, you must examine each and every insurance policy at issue, to determine whether coverage exists and whether it may be “stacked.”

Basic Insurance Requirements:

The State of Nevada requires that every individual operating a vehicle carry a minimum liability insurance policy. A minimum policy covers up to $15,000 for the bodily injury or death of an individual in any one accident. See NRS 485.185(1). Additionally, the policy covers up to $30,000 for bodily injury or death of two (2) or more persons in any one accident, and $10,000 for the injury to, or the destruction of, property of others in any one accident. See NRS 485.185(2)(3). This minimum level of coverage is often referred to as “15/30/10.”

Uninsured Motorists Protections:

Traditionally, when an accident is caused by another person, the at-fault party’s coverage will pay your medical bills or property damage. Following exhaustion of the liability coverage, you may be responsible for any and all outstanding medical bills and/or property damage. Worse, if an accident occurs with an uninsured motorist, you may be responsible for the entirety of your medical bills and property damage.

To avoid this risk, we suggest purchasing Uninsured Motorist (UM) and Underinsured Motorist (UIM) coverage. Uninsured Motorist Coverage will cover expenses that result from an accident with an individual who does not have insurance. Underinsured Motorist Coverage will cover the remainder of the costs of injuries and property damage following exhaustion of the at-fault driver’s liability insurance.

In Nevada, an insurer must offer uninsured underinsured motorist coverage equal to the limits of coverage of bodily injury. See NRS 687B.145(2); Peterson v. Colonial Insurance Co., 686 P.2d 239 (1984). Additionally, Uninsured Motorist Coverage includes Underinsured Motorist Coverage. NRS 690B.0202(3).

Further Protection via UIM/UM Stacking:

Even with UM/UIM coverage, it is possible that a severe accident will result in medical bills and injuries beyond your UM/UIM limits. Nevada allows for the “stacking” of UM/UIM coverage, which authorizes the collection from more than one insurance policy.

Insurance Stacking Within the Same Policy:

“[When] the insurer issues two automobile policies containing uninsured motorist coverage, the extent of coverage is the combined total amount of such policies, and actual damages sustained by the insured are recoverable to the full extent of the combined limits of both policies.” United States Auto Ass’n v. Dokter, 487 P.2d 583, 585 (1970). See also Travelers Ins. Co. v. Lopez, “An insured is entitled to payment in full up to the policy limit, with respect to each policy under which coverage is afforded.” 567 P. 2d 471, 474 (1977).

Nevada Law is clear on this issue. If you have multiple vehicles with UM/UIM coverage, you can “stack” each policy to cover your medical bills and property damage. For example: If you have two cars that are each insured with $25,000 of bodily injury coverage and are involved in an accident with an uninsured or underinsured individual, you may be able to stack your policies, resulting in the collection of up to $50,000.

Stacking With Different Policies:

The Travelers Insurance case previously cited also dictated one’s ability to stack insurance coverage across different policies. The Supreme Court stated, “There exists no legislative prohibition against the “stacking” of insurance policies when both insurers are at the same level of priority.” Travelers Ins. Co. v. Lopez, 567 P. 2d 471, 473 (1977).

For example: If you have two vehicles, one which is insured with $25,000 of bodily injury coverage with Insurance Group A and a second which has $50,000 of coverage with Insurance Group B, you may be able to collect up to $75,000. It may not matter whether you are driving Vehicle 1 or Vehicle 2.

Calculating UM/UIM Collections:

If you are involved in an accident in Nevada and the at-fault party is underinsured or uninsured, you can make a claim for UIM/UM benefits on your own policy. Nevada Law specifically compensates you for damages in excess of the at-fault party’s policy. (NRS 687B.145(2))

For example, if an at-fault driver carries at $25,000 dollar liability policy and you carry a $50,000 dollar UIM/UM policy, your UIM/UM policy will pay for all damages in excess of $25,000 up to an additional $50,000. This allows for a recovery up to $75,000.

Anti-stacking Provisions:

The Nevada Legislature provided a means for insurance companies to prevent the stacking of Uninsured Motorist Coverage. Neumann v. Standard Fire Ins. Co. of Hartford, 699 P.2d 101, 103 (1985). There are three prerequisites to determining the validity of an anti-stacking provision:

1. The limiting provision must be expressed in clear language;
2. The provision must be prominently displayed in the policy, binder, or endorsement; and
3. The insured must not have purchased separate coverage on the same risk nor paid a premium calculated for full reimbursement under that coverage.

Non-compliance with either of the first two prerequisites or payment of a double premium, notwithstanding compliance with the first two prerequisites, will render the limiting provision void. Id.; see also Nationwide Mut. Ins. Co. v. Coatney, 118 Nev. 180, 42 P.3d 265 (2002); NRS 687B.145(1)

Valid Anti-Stacking Provision:

Below is an example of a valid anti-stacking provision. Please note the clear and prominent language stating that “Coverage may not be added, stacked, or combined based on the number of autos of persons insured.”

Ensuring Insurance Stacking:

As noted above, Nevada allows insurance companies to deny your ability to stack insurance coverage. To better protect yourself, it is important that you contact your insurance agent and request the ability to stack coverage. You will likely be unable to stack without an endorsement from your agent, as an anti-stacking provision is likely in your current policy. If you would like to consult with a reputable insurance agent, please contact us and we can refer you to someone.

If you have been involved in a car or motor vehicle accident, let us maximize your recovery. An experienced injury attorney and firm can evaluate your various insurance policies to see if coverages can be “stacked” to properly compensate you for your injuries and damages.