Example of Stacking and Reducing Clauses
Under Truth in Auto the catastrophically injured person would be able to add (stack) all three $100,000 policies together because the reasonable damages totaled $300,000. Not only would the catastrophically injured person be entitled to the full $300,000 in benefits, but Insurer X was also prohibited from reducing these benefits by the $25,000 already received from the at-fault driver's insurance company. In these examples under Truth in Auto, the injured person would be fully compensated and get the $300,000 in benefits rightly owed to them. Under Gov. Walker the injured person only gets paid $100,000 total ($25,000 from the at-fault driver and $75,000 in reduced UIM benefits) and Insurer X pockets the other $200,000. Thus, those catastrophically injured people will be forced to seek Medicare coverage for their future medical expenses.
End result of the Elimination of Stacking
At the end of the day Wisconsinites were sold a bill of goods, and many will not know the true effect of these changes in the law until they are seriously injured in a crash and it is too late to change the existing coverages. Wisconsinites will now have to subsidize these catastrophically injured people through higher Medicare costs with absolutely no cost to the rich insurance companies. Further, while the amounts Wisconsinites pay in State taxes will undoubtedly increase, the large Wisconsin insurance companies under Gov. Walker will now be paying less than their fair share in taxes even though they are reporting record profits and paying out insane amounts in executive compensation and bonuses.