Uninsured Motorist Claims in Maryland

As top car accident lawyers in Maryland, one of the questions we get asked all the time is what happens when you get in a car accident with an uninsured motorist? Maryland, like almost every other state in the country, has laws that require all drivers on the road to have an active auto insurance policy.

Unfortunately, not everybody follows the law and there are many people who drive without any car insurance. Your odds of being in an Maryland auto accident with an uninsured or underinsured driver might be higher than you think.

So – what can you do as an accident victim of an uninsured motorist? Fortunately, Maryland auto insurance laws give you options. And we can help you know how to use them.

Here is what happens:

1. You are obligated to exhaust the full amount of liability insurance coverage from the underinsured motorist.
2. The insurance company for the tortfeasor (underinsured driver) “tenders” their policy limits.
3. You are then required to send a formal letter to your insurance company advising that the at fault driver’s insurance company tendered their coverage limits.

The reason for this is that the tortfeasor’s insurer requires, as part of its policy limits tender, that the tortfeasor is released from any future claims as a result of the accident. That makes sense – they don’t want to pay out the full amount of the policy unless they know that their insured is completely protected.

However, the UIM insurer maintains a right of subrogation against the at-fault driver. This is a legal way of saying that if your insurance company has to pay you money because of someone else’s negligence, your insurance company could go after that person to get their money back.

So the at-fault driver’s insurance will not actually pay the policy limits unless the UIM insurer waives its right to subrogation. If the UIM carrier refuses to waive subrogation, then the tender is withdrawn and there is no settlement. However, the UIM carrier must tender the liability insurance limits to the injured insured within thirty (30) days of its refusal to consent, which is required to be provided in writing.

However, if the UIM carrier agrees to waive subrogation, then the tortfeasor is protected. That insurer will pay the policy limits, and you are able to negotiate with your own insurance company for any additional settlement funds over and above the funds you already received.

Sound complicated? It is. And we’re not tooting our own horn here. Even many lawyers make mistakes in this process. That’s why it’s so important that you find a lawyer you can trust. At Dubo Law, we’ve helped clients recover millions in cases like these.

A common question is whether you can add the two policies together to maximize the amount of insurance coverage available. This is more frequently referred to as “stacking” and it is not permitted in Maryland, except in certain situations which are addressed below.

Underinsured Motorist Coverage Example

To illustrate this point, let’s use an example. Assume hypothetically, that you are involved in an accident where the tortfeasor had $30,000 in insurance coverage and you had a $100,000 UM/UIM policy. Under Maryland law, you could not add – or stack – those policies together to obtain $130,000 in insurance coverage. You are limited to the total amount of coverage available under your own policy.

So in this hypothetical, the most you could receive was $100,000 (the total amount of your coverage). $30,000 from the tortfeasor’s insurance policy, and the additional $70,000 from your own policy.

However, effective October 1, 2017, Maryland adopted a new law that now permits individuals to purchase certain enhanced insurance policies that allow stacking. However, these are very specific types of policies, so if you have any questions, you should contact your own insurance company or broker and they should be able to advise and assist you.

It is possible in certain situations, that there could be multiple UM/UIM policies available to an individual. Normally, for drivers and passengers, the coverage for the vehicle in which they were traveling is primary, but there may well be a secondary policy as well.

Underinsured Motorist Coverage With Multiple Policies

Another example for purposes of illustration. Suppose you are a passenger in your friend’s vehicle and you get into an accident with another car. Let’s assume that the tortfeasor has $30,000 in coverage available to you and that your friend (whose car you were traveling in), has $100,000 in UIM coverage. However, let’s further assume that you have your own insurance policy which has $500,000 in UIM coverage.

In that scenario, depending on the extent of your injuries and pain and suffering, once the $30,000 in tortfeasor coverage is exhausted, your friend’s UIM policy would be primary up to $100,00 (so an additional $70,000). But then, because you had a separate policy in excess of the $100,000, your policy would then kick in as secondary UIM coverage for up to an additional $400,000.