Higher Minimum Vehicle Liability Requirements

How much auto insurance am I required to have in Nevada?

The State of Nevada requires every individual operating a vehicle to carry a minimum liability insurance policy. Effective July 1, 2018, the minimum insurance liability coverage for motor vehicles increased to $25,000 per person for bodily injury, $50,000 per accident for bodily injury, and $20,000 per accident for property damage.

In addition to the state’s required insurance, Nevada drivers have the option to purchase Uninsured Motorists (UM) and Underinsured Motorists (UIM) coverage, which provides for more coverage protection than the minimum coverage required by Nevada law. Uninsured Motorist coverage will cover expenses that result from an accident with an individual who does not have insurance. Underinsured Motorist Coverage will cover the remainder of the injuries and property damage costs you may still have following the exhaustion of the at-fault driver’s liability insurance.

Traditionally, when an underinsured motorist causes an accident, the at-fault party’s coverage will pay your medical bills or property damage. Following exhaustion of the liability coverage, you may be responsible for all remaining medical bills and/or property damage. In a worst-case situation, if an uninsured motorist causes an accident, you may be responsible for the entirety of your medical bills and property damage. Many drivers purchase Uninsured Motorist and Underinsured Motorist coverage to avoid this risk.

Stacking Insurance Policies

Further Protection via UM/UIM Stacking: 

Even with Uninsured Motorist and Underinsured Motorist coverage, a severe accident may result in medical bills and injuries beyond your Uninsured Motorist or Underinsured coverage limits. Unlike California, Nevada allows for the “stacking” of Uninsured Motorist and Underinsured Motorist coverage, which allows for collection from more than one insurance policy.

Insurance Stacking Within the Same Policy: 

Nevada Law is clear that when you have multiple vehicles with Uninsured Motorist and Underinsured Motorist coverage, you can “stack” each policy to cover your medical bills and property damage. For example: If you have two cars that are each insured with $25,000 of bodily injury coverage and are involved in an accident with an uninsured or underinsured individual, you may be able to stack your policies, resulting in the collection of up to $50,000. 

Stacking With Different Policies:

A Nevada driver can also “stack” insurance coverage across different policies. For example: If you have two vehicles, one that is insured by Insurance Group A with $25,000 of bodily injury coverage, and a second insured by Insurance Group B, which has $50,000 of bodily injury coverage, you may be able to collect up to $75,000. Whether you are driving Vehicle 1 or Vehicle 2 at the time of the accident may not matter with respect to the amount ultimately collected.

Calculating UM/UIM Collections: 

If you are involved in an accident in Nevada, and the at-fault party is uninsured or underinsured, you can make a claim for Uninsured Motorist and Underinsured Motorist benefits from your insurance policy. Nevada Law compensates you for damages in excess of the at-fault party’s policy. For example: If an at-fault driver carries a $25,000 liability policy, and you carry a $50,000 Uninsured or Underinsured Motorist endorsement on your policy, your policy will pay for all damages in excess of $25,000 up to an additional $50,000. This allows for recovery of up to $75,000.

Anti-stacking Provisions:

The Nevada Legislature provides an avenue for insurance companies to prevent the stacking of Uninsured Motorist Coverage. There are three prerequisites to determining the validity of an anti-stacking provision:

The limiting provision must be expressed in clear language;

The provision must be prominently displayed in the policy, binder, or endorsement; and

The insured must not have purchased separate coverage on the same risk nor paid a premium calculated for full reimbursement under that coverage.

An insurance company’s failure to comply with either of the first two prerequisites or payment of a double premium, notwithstanding compliance with the first two prerequisites, will make the limiting provision void and unenforceable.  

By Elisa K. Boss, Esq.