Often times when I ask a potential client if they have “stacking” of their no-fault benefits, I am met with a confused response. The most typical answer is, “what is stacking?” Because “stacking” can have huge ramifications for protecting you from the financial hardships caused by a motor vehicle accident, today’s blog will answer the question of “what is stacking, and why is it so important?”
The simple answer is “stacking” is an insurance mechanism by which you can increase the amount of no-fault benefits available to you and your family by multiplying the basic no-fault benefits by the number of motor vehicles that you own. As we have discussed in previous blog entries, basic no-fault coverage provides for $20,000 in medical expense benefits, and $20,000 in wage loss benefits (reimbursed at a rate equal to 85% of the total wage loss with a weekly maximum of $250) for injuries arising out of the use or maintenance of a motor vehicle. If you own two motor vehicles, and elect to purchase “stacking” coverage, your benefits are doubled and you would have $40,000 in medical expense benefits, and $40,000.00 in wage loss benefits (now with a maximum of $500 per week) available to you. If you stacked three vehicles, your benefits triple to $60,000 in medical expense benefits, and $60,000 in wage loss benefits (now with a maximum of $750 per week), and so on and so forth.
Furthermore, even if you have good health insurance, “stacking” your no-fault coverage provides two other significant benefits. First, unlike most health insurance which requires deductibles and co-pays, no-fault has no such requirements and will pay the first dollar of your medical bills. Second, if your health insurance pays for accident related injuries caused by the fault of another driver, in most cases, they have contractual claim for reimbursement from your personal injury settlement. No-fault, on the other hand, has no right to reimbursement from your settlement, except in very limited and narrow circumstances.
Another significant benefit from “stacking” is the increased wage loss benefit coverage. Basic no-fault benefits provide a maximum of $250 per week for lost wages, which is usually insufficient to cover even the most basic of an average family’s expenses. If you have two vehicles, and elect to purchase “stacking” coverage, the weekly wage loss maximum increases to $500 per week. Stacking coverage on three vehicles triples your maximum wage loss benefit to $750 per week. This increase is $2,000 per month in additional wage loss benefits and could be the difference between “getting by” and financial ruin. This is especially important if your injuries are serious and you miss work for an extended period of time.
It is important to note however, that you must elect to purchase stacking and pay a slight increase in premium. This premium increase however is small compared to the substantial benefits you could receive if you are injured in a motor vehicle accident. Our recommendation is that you always purchase this coverage to protect you and your family. If you own more than one motor vehicle, talk to your insurance agent today to find out if you have “stacking” coverage, and if not, how to get it. If you or a loved one have been in an accident and want to learn more about what benefits are available, contact one of our experienced attorneys today for a free consultation.