What does “stacking” insurance policies mean?
In SC, if the at-fault driver does not have enough insurance or if there is no insurance coverage other than uninsured motorist (UM) or underinsured motorist (UIM) policies, you are allowed to recover damages from more than one policy in succession until all damages are paid or until the policy limits have been reached.
How does stacking work? Below, we will cover the basics of stacking insurance policies in SC, including:
- What “stacking” means,
- How your UM and UIM policies can help you to recover full damages,
- When you are allowed to stack insurance policies in SC, and
- Why your insurance company cannot prevent stacking in your insurance agreement.
What Does “Stacking” Mean?
If the at-fault driver in your car accident doesn’t have enough insurance coverage to pay your damages, or if they do not have insurance coverage at all, your uninsured motorist (UM) and underinsured motorist (UIM) policies may kick in and cover your costs.
If your UM or UIM policies are not enough to cover the damages, in SC you are permitted to “stack” multiple policies until your damages are paid or until you reach the policy limits of all policies.
This applies to any policies that cover you as an insured. For example, in State Farm v. Windham, the SC Court of Appeals held that State Farm was required to permit the plaintiff to stack UIM policies, even though 1) the plaintiff was driving a rental car at the time of the accident and 2) one or more of the UIM policies in question belonged to her husband.
The at-fault driver’s policy was not sufficient to cover the plaintiff’s damages (and presumably there was no coverage or insufficient coverage by the rental car company’s insurance), and so the plaintiff was permitted to recover from her own UIM policies (even though she was not driving her own vehicle) and her husband’s UIM policies (even though her husband was not driving).
Uninsured and Underinsured Motorist Policies
Every driver in SC is required to purchase uninsured motorist coverage (UM), which pays in situations where the at-fault driver does not have insurance or cannot be located.
SC Code § 38-77-150 requires insurance policies to include at least $25,000 in UM coverage, and SC Code § 38-77-160 requires insurance companies to offer UIM coverage up to the policy limits of the driver’s liability coverage, although drivers are not required to purchase it.
Underinsured motorist coverage (UIM) is not required by law, but it is a good idea. When the at-fault driver’s insurance policy is not sufficient to cover your damages, your UIM policy will then kick in and pay the difference.
In SC, you are permitted to “stack” multiple policies until you are fully compensated or until you reach the policy limits of all available policies.
Who is Allowed to Stack Insurance Policies?
In SC, a “Class I insured” can stack insurance policies, but a “Class II” insured cannot stack policies.
A Class I insured includes:
- The named insured,
- The named insured’s spouse, and
- The named insured’s relatives living in their household.
A Class II insured includes:
- Any person using the motor vehicle with the consent of the insured, and
- Any guests in the motor vehicle.
It doesn’t matter who owns the vehicle – SC law says that if you are a Class I insured, you are permitted to stack multiple policies.
Limits on Stacking Insurance Policies in SC
There are limits to the amount of compensation that you can recover by stacking policies – the amount that you can recover from each policy cannot exceed the maximum coverage of the primary liability insurance for the vehicle that was involved in the accident.
Stacking of Insurance Policies Cannot be Prohibited by Your Insurance Company
Can the insurance company just insert a clause into your contract that says stacking of insurance policies is prohibited?
No, because SC law requires the insurance company to allow stacking. If there is a clause in your policy that prohibits stacking, it is void under SC law and the courts will allow stacking despite your agreement with the insurance company.
Questions About Stacking Insurance Policies in SC?
If you are hurt in an auto accident caused by another driver in Conway or Myrtle Beach, SC, consult with an experienced trial lawyer immediately who can help you to gather the evidence you need to prove liability and damages, settle your claim for full and fair compensation, and try your case to a jury if the insurance company doesn’t pay.
Call Johnny Gardner Law now at 843-248-7135 or send us an email through our website to find out how we can help.