1. Forms
2. CA
3. CA-01-28

Form CA 01 28: Florida Uninsured Motorists Coverage - Non-Stacked

1. What the form is

The CA 01 28 is an endorsement to the standard Business Auto Coverage Form (CA 00 01) specifically for commercial auto policies written in Florida. Its primary purpose is to provide non-stacked Uninsured Motorists (UM) Coverage as permitted by Florida law. "Non-stacked" means that the UM coverage limits for multiple vehicles insured under the same policy (or across multiple policies for the named insured) cannot be combined or "stacked" to increase the total amount of coverage available in the event of an accident with an uninsured or underinsured motorist. This form modifies the standard UM provisions to reflect this non-stacked selection, typically resulting in a lower premium compared to stacked coverage.

2. Classes of business it applies to

This endorsement applies to any commercial entity in Florida purchasing commercial auto insurance that elects non-stacked Uninsured Motorists Coverage. There isn't a specific restriction to particular industries, but it's often considered by:

• Businesses with multiple vehicles on their policy where stacked UM coverage could lead to very high limits and correspondingly higher premiums.
• Cost-conscious businesses seeking to manage their insurance expenses, provided they understand the trade-off in potentially lower available UM limits.
• Companies whose risk management philosophy accepts the limitations of non-stacked coverage in exchange for premium savings.

3. Special considerations

Several important considerations apply when using the CA 01 28 endorsement in Florida:

• Informed Choice Required: Florida law mandates that insurers offer UM coverage, and the insured must be given the option to select stacked or non-stacked coverage, or to reject UM coverage altogether (though rejection is generally not advisable). The selection of non-stacked UM coverage must be an affirmative and informed choice by the insured.
• Signed Selection/Rejection Form: Typically, Florida requires a separate, specific form to be signed by the named insured documenting their choice of UM coverage (stacked, non-stacked, lower limits, or rejection). The CA 01 28 endorsement then reflects this choice on the policy itself.
• How Coverage Applies (Non-Stacked):
  • If an insured is injured while occupying a motor vehicle they own (and that is insured), the UM coverage available is generally the coverage on that specific vehicle.
  • If an insured is injured while not occupying a motor vehicle they own (e.g., as a pedestrian or a passenger in someone else's car), they may be entitled to select any one limit of UM coverage for any one vehicle afforded by a policy under which they are a named insured or an insured resident of the named insured's household.
• Premium Reduction: Electing non-stacked UM coverage typically results in a lower premium than stacked coverage because the potential payout from the insurer is limited.
• Impact of CA 00 01: This endorsement modifies the Uninsured Motorist Coverage section of the base Business Auto Coverage Form (CA 00 01) or is used in conjunction with it.

A real-world example of a special consideration: If a business owner has three company vehicles, each with $100,000 in non-stacked UM coverage, and an employee is injured by an uninsured motorist while driving one of these vehicles, the maximum UM coverage available from this policy for that accident would be $100,000 (the limit on the occupied vehicle). If they had elected and paid for stacked coverage, the available limit could have been $300,000.

4. Key information for agents and underwriters

• Pricing: Non-stacked UM coverage is priced lower than stacked coverage due to the reduced exposure for the insurer. Underwriters will verify that the premium reflects this selection.
• Risk Assessment: The primary risk assessment factor is ensuring the insured fully understands the implications of choosing non-stacked coverage – specifically, that they are trading potentially higher coverage limits for a lower premium. The selection must be a conscious one.
• Coverage Gaps Awareness: Agents have a critical role in clearly explaining the difference between stacked and non-stacked UM coverage to the insured. This is vital to prevent misunderstandings and potential Errors & Omissions (E&O) claims if an insured later feels they were inadequately covered. The agent should document this explanation.
• Underwriting Guidelines & Documentation:
  • Underwriters must ensure that all Florida-specific requirements for selecting non-stacked UM coverage have been met, including the proper execution of any state-mandated UM selection/rejection forms. These forms are paramount.
  • The CA 01 28 endorsement must be correctly added to the policy to reflect the insured's choice of non-stacked coverage.
  • Verify that the UM limits selected (even if non-stacked) comply with any underlying policy requirements or umbrella requirements, if applicable.
• Relationship to CA 00 01: The CA 01 28 amends the standard UM coverage provisions that would otherwise apply under the CA 00 01 Business Auto Coverage Form. It tailors the policy to the specific choice made by the Florida insured regarding how their UM coverage will operate.

For instance, an underwriter reviewing an application with the CA 01 28 attached will specifically look for the corresponding signed Florida Uninsured Motorist Coverage selection form, confirming the named insured has explicitly chosen non-stacked coverage and understands this choice. The absence of this properly executed selection form could be a significant compliance issue in Florida.