Articles Posted in Insurance Issues

Anyone who drives in Connecticut is required to obtain a certain amount of insurance. The purpose of this requirement is two-fold. First, if a driver causes an accident resulting in serious injuries, the driver may not be able to pay for the victim’s injuries. Insurance provides a source of compensation for the accident victim, even if the at-fault driver is insolvent.

The second reason for the auto-insurance requirement is for a motorist’s own protection in the event of an accident caused by an underinsured driver or a driver who has no insurance at all. In these cases, a motorist’s underinsured/uninsured protection will cover their injuries, up to the policy limit. However, even with uninsured motorist protection, there are some situations in which a motorist will not fully be able to recover compensation, due to the limits of their own policy. Conversion insurance can help motorists tap into the full value of their policy.

Conversion insurance, like underinsured motorist protection, provides coverage in the event of an accident involving an underinsured motorist. The benefit of conversion insurance, however, is that it is not reduced by payments received from other sources. For example, assume a motorist with a $200,000 insurance policy sustains $500,000 in injuries caused by another driver with an insurance policy maximum of $300,000. With traditional underinsured motorist protection, the accident victim will only receive $300,000 from the underinsured driver’s insurance policy. This is because the accident victim’s insurance policy only guarantees $200,000, regardless of the source. In this case, the accident victim received what he was promised– $200,000 – even though it was not from his own insurance policy. Thus, the accident victim’s claim under his own insurance policy would be for $0. This is because with traditional underinsured motorist insurance, the total recovery amount is reduced by funds received from any other source, in this case the other motorist’s insurance policy.

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While car insurance is required in Connecticut, unfortunately not every motorist purchases the required coverage, and sometimes even when a motorist does have insurance, they do not have enough to cover the costs of an accident that they cause. In these situations, the accident victim’s own insurance policy or policies may kick in to help provide the accident victim with much-needed compensation for their injuries. This is because Connecticut requires all drivers to carry underinsured/uninsured motorist coverage. Underinsured motorist protection provides coverage in hit-and-run accidents, as well as when the at-fault party does not have insurance or does not have enough insurance.

What is Stacking?

Stacking refers to seeking compensation from two separate insurance policies. For example, assume that a driver incurs $200,000 in medical bills after a hit-and-run accident. The at-fault driver effectively has no insurance because they cannot be located, so the accident victim’s uninsured motorist coverage kicks in as the sole means of compensation. However, what if the motorist has an insurance policy that covers several vehicles? What if the accident victim has two insurance policies?

Stacking Insurance Policies in Connecticut

Connecticut is an anti-stacking state, meaning that as a general rule, accident victims are not permitted to stack coverage within a single policy. This means that an accident victim who has a policy that covers three vehicles at $50,000 per vehicle will not be able to obtain $150,000 for a single accident by stacking the coverage for the three covered vehicles. In this situation, the accident victim will be limited to the $50,000 per vehicle limit.

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Every Connecticut driver is required to have a certain amount of insurance to help cover the costs of an accident should one occur. The idea behind the Connecticut car insurance requirement is that a driver may not have the means to cover the costs of the property damage and medical bills that result from an accident that they cause. By requiring drivers to have insurance, this ensures that accident victims will not be left without any means of recourse.

Connecticut lawmakers are responsible for setting motor vehicle insurance limits. Liability insurance covers any accident caused by the vehicle owner’s negligence or the negligence of anyone they allow to use their vehicle. Currently, Connecticut requires that motorists carry coverage for $20,000 per person and $40,000 per accident for bodily injury and $10,000 for property damage.

Some serious Connecticut car accidents, however, result in far more damage than these liability limits cover. For this reason, lawmakers also require that Connecticut motorists carry insurance in the event that the person who causes an accident does not have sufficient insurance or has no insurance at all.

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