If you are looking for an auto insurance quote in Pennsylvania, you have an option of choosing stacked coverage vs. unstacked coverage. Don't feel so bad if you don't know what it means. Most states do not have this option, and thus not too many article insurance tutorials mention it. But it is very simple to understand.
To understand stacked vs. unstacked uninsured/underinsured motorist coverage, you must first have a grasp on what uninsured and underinsured motorist coverage is. Uninsured motorist coverage (UM) protects you when the person you hit does not have auto liability insurance. Underinsured motorist coverage (UIM) protects you when the person you hit does have insurance, but the levels of liability that they carry are not enough to cover your bodily injury expenses.
Both coverages are very important. There is an alarming percentage of people driving without insurance, or driving with only minimal levels of insurance. Many states combine UM and UIM coverage and offer them as one in the same. Some states require both UM & UIM coverage, some states only require UM coverage, and some states such as Pennsylvania require neither one. They are two separate coverages and both are optional.
When we talk about stacked and unstacked coverage, we're only talking about the UM & UIM part of the policy. Nothing else. The major difference between whether you should choose stacked or unstacked really only boils down to how many vehicles you're insuring on your policy. If you only have one vehicle, there's no need to select the stacked option. But the stacked option is a good idea if you are insuring more than one vehicle.
To help you understand the difference between stacked and unstacked coverage, consider the following scenario:
John has 3 cars on his auto insurance policy. His neighbor Dave also has 3 cars on his policy. Both John and Dave selected 100/300 UM protection and 100/300 UIM protection. But John selected the stacked option for both UM and UIM, while John decided to settle for the unstacked option for both.
Having the stacked option simply multiplies the level of UM or UIM protection by the number of vehicles that you have. So while john selected 100/300 UM and UIM coverage, because he has 3 cars on his policy and he selected the stacked option, he really has 300/900 in UM and UIM coverage. Dave on the other hand, selected the unstacked option, so he only gets the coverage he asked for, which was 100/300.
That's the only difference between stacked and unstacked coverage. Of course, it makes no sense for someone with only one insured vehicle to select the stacked option. But for those with multiple insured vehicles, the stacked option is a great idea. The difference in premium between stack and unstacked coverage is usually minimal and offers you levels of UM/UIM coverage that's not available in most states.
The companies my agency carries in PA all have reasonable rates for both the stacked and unstacked coverages.
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PA Auto Insurance: Stacked vs. Unstacked Uninsured Motorist Coverage FAQ’s
Michigan has three types of collision coverage to choose from: Standard, Broadform and Limited.
Standard form collision coverage is the most straightforward of the three types of collision coverages. In the event of an accident, standard collision coverage will pay the amount of the loss (up to the market value of the vehicle) minus the deductible. Most states only have one type of collision coverage, and that would be the standard form. Michigan is one of the few (if not the only) state that also have broadform and limited options.
Broadform collision coverage is nearly identical to standard collsion coverage, other than broadform coverage offers an added benefit that the standard coverage doesn't have. With broadform collision coverage, if you are in an accident and the other driver is more than 50% at fault, your deductible is waived. That is the only difference between the two coverages.
Limited form collision coverage is a whole different animal! I don't recommend for anyone to select the limited form coverage and here's why: If you are in an accident, and you are more than 50% at fault, you get nothing! Zero! In my opinion, you either choose to have collision coverage or you don't. Choosing to have collision coverage should be a simple yes or no answer, not maybe! This coverage obviously leaves a driver exposed to losing his or her vehicle if there is an at-fault accident. If you're trying to save a few bucks on your auto insurance, this is NOT the place to be butting corners. Not to mention, if you are financing your vehicle, it's a guarantee that banks and finance companies will not accept limited coverage.
To summarize, the thing I want you to get out of this article is to avoid the limited coverage! Either have collision coverage or don't have it. Choose either standard or broadform coverage.
Check your current auto insurance policy and see which coverage you have selected on your policy. And also, if you're paying too much for auto insurance, get a quote with my agency, and see how much money I can save you!
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Dan Lyles is an Independent Insurance Agent serving Ohio, Indiana, Michigan, Pennsylvania, Virginia and West Virginia..