Q: I have an auto policy with State Farm on a Dodge Caravan and another for a Mazda sedan. My agent told me a new law allowed me to have uninsured-driver coverage for both vehicles by paying for it on only one car. So, I dropped the coverage when the policy for the first vehicle renewed. When the renewal premium for the second vehicle came due a few months later, uninsured-driver coverage went up in cost, negating my savings. Is this illegal or just a coincidence?— Kathy Johnson
A: What you describe is a Colorado law that went into effect Jan. 1 allowing consumers to “stack” coverages for uninsured/underinsured motorists (UM/UIM) on multiple auto policies.
That means if you pay for UM/ UIM coverage on each vehicle, let’s say $100,000 limits for each, you could “stack” the coverages and be insured for $200,000 if you had an accident with an uninsured driver — no matter which car you were driving.
By removing the coverage on one vehicle, you were still covered for both. Previously, insurance companies were allowed to prohibit stacking — and most did. In the above example, you’d have been limited to $100,000 coverage.
As a result, many insurance companies are now charging UM/UIM premiums on a household basis rather than per vehicle to avoid stacking.
So your coverage is essentially the same as before — as is the premium, for the most part — it’s just charged differently.
David Migoya wants to get the answers to your consumer questions. E-mail consumertips@ denverpost.com or write to Consumer Shopping Bag, The Denver Post, 101 W. Colfax Ave. Suite 600, Denver, CO, 80202.
