Virginia Insurance Laws and "Stacking"
Posted on behalf of Goldberg Finnegan, LLC on Mar 16, 2009 in Car Accidents
Every day, Americans are bombarded with reminders of the tough economic times facing this country. Another day passes with losses on the stock market. Another large financial institution requires more Federal funding to survive. Home foreclosures remain on the rise, while consumer confidence is approaching all-time lows.
As Americans try and adjust to these new economic realities, many individuals are finding ways to cut costs at home. Unfortunately, some methods employed by individuals may have an impact on the nation's drivers. In January, the Insurance Research Council prepared a report indicating that due to the recent economic downturn (and the corresponding rise in unemployment), many of the nation's drivers were cancelling or letting their automobile insurance policies lapse. Yet, they would remain on the road, hoping to avoid an accident. According to the study, "a single percentage point increase in the unemployment rate is associated with a half-point increase in the percentage of uninsured drivers," said David Corum, council vice president. The nation's jobless rate was up two percentage points to 6.7% in November from a year earlier.
If you are a Virginia resident and are involved in an automobile accident caused by an uninsured (or underinsured) driver, then you can make sure you are protected due to the concept of "stacking" coverage, which is generally permissible in the Commonwealth of Virginia. (Unfortunately, stacking is not permitted in Maryland).
For example, if you are involved in an accident caused by an uninsured driver, your automobile policy's uninsured/underinsured motorist coverage will provide you with coverage for the incident and any medical bills you may incur up to the policy limits of that insurance coverage. If, however, the level of coverage is not enough to cover all of the bills, if there are other drivers who reside with you and are "resident relatives" who have their own automobile insurance policies, you can "stack" their uninsured/underinsured motorist coverage with your coverage, increasing the total coverage available to you. The following example will illustrate how this works.
Perhaps you are hit by a driver who only obtained the minimum liability coverage when they insured their vehicle as a means of reducing their expenses. In Virginia, the minimum coverage allowed by law is $25,000 per person/$50,000 per accident. With the rising costs of health care, $25,000 may simply not be enough to cover your injuries and medical bills. "Stacking" can make sure you are covered in this situation as well. If, hypothetically, your vehicle was the only vehicle in your home, and your automobile policy provided $25,000 for uninsured/underinsured motorist coverage, you would not be able to recover anything above the other driver's $25,000. However, if or there were other vehicles in your home insured by resident relatives, you can probably "stack" the policies to create higher limits of protection. If there were two more cars in your home, one with $50,000 in uninsured/underinsured motorist coverage, and the other with $100,000 in uninsured/underinsured motorist coverage, these three policies would "stack," and the result would be uninsured/underinsured coverage for your injuries in the amount of $150,000. (The total is $175,000, but that would be subject to a $25,000 credit from the liability policy for the person causing the accident.) In this situation, if the $25,000 cannot cover all of your injuries and medical bills, Virginia's "stacking" rules make sure you can be covered.
Also, automobile insurance policies offer coverage for PIP or med-pay. These are benefits which can be used to pay for medical expenses that result for an automobile accident. In the Commonwealth of Virginia, just as uninsured/underinsured benefits can be "stacked," med-pay benefits can be stacked as well. If your policy provides you with $2,000 in med-pay benefits, but the other two vehicles in your home also have $2,000 in med-pay benefits, then you can "stack" those three to provide you with $6,000 in med-pay benefits, to be put towards your medical bills and expenses.
To make sure that you and your family have the necessary coverage to protect you in such a situation, call your insurance broker or visit your insurance company's webpage to find out more information. Make sure that you purchase enough automobile insurance to cover you if you are in an accident with an uninsured or underinsured driver and also enough liability insurance to cover you if you are at fault and cause injuries to someone else. You should have at least as much liability insurance as you have assets. If you or a loved one has been injured in an automobile accident, call the experienced Virginia and Maryland auto accident attorneys at Goldberg Finnegan, LLC today for your free consultation. We can be reached at (301)589-2999, or 24 hours a day through our website, www.goldbergfinnegan.com.