Maryland Auto Insurance Law

Basic Overview of Coverage

Auto insurance coverage may include several types of protection; however, Maryland auto insurance law requires all registered vehicle owners to purchase certain minimum protections or coverage levels.

Many drivers purchase more than the minimum requirements to protect themselves from high repair bills, medical expenses and lawsuits. Consumers who opt to purchase coverage above Maryland’s minimum requirements, however, will pay higher premiums.

Liability Insurance

Liability insurance protects policyholders when they have caused an accident. There are two types of liability coverage that are required by Maryland auto insurance law: bodily injury liability coverage and property damage liability coverage.

Bodily Injury Liability Insurance

If you cause an accident and an injured person makes a claim or files a lawsuit against you, bodily injury coverage will:

  • pay for a lawyer to defend you if you are sued;
  • pay what you are ordered to pay as a result of a lawsuit; or,
  • pay to settle the claim out-of-court.

In other words, if the claim against you is covered by bodily injury insurance, then – up to the dollar limits of the coverage that you purchased – your personal assets (i.e. savings, investments) will not have to pay for claims or lawsuits filed by any injured person.

Property Damage Liability Insurance

If you cause an accident that damages someone’s property (such as their car) and the property owner makes a claim or files a lawsuit against you, property damage liability coverage will:

  • pay for a lawyer to defend you in the event that you are sued;
  • pay monetary judgments against you in a lawsuit; or,
  • pay to settle the claim out-of-court

In other words, if the claim against you is covered by property damage liability insurance, then – up to the specified dollar amount of the coverage that you purchased – you will not have to use your personal assets to pay claims or lawsuits filed by the property owner(s).

Other people, such as family members, also may be covered under your insurance policy’s bodily injury or property damage coverage if they are listed on the policy as drivers; if they are driving your car for an occasional purpose with your consent; and, if they are not otherwise excluded by your policy’s terms.

If you are unsure whether a potential driver would be covered under your policy, read the terms of your policy or call your insurance agent before you let that person drive the car.

Note: While Maryland auto insurance law establishes the minimum level of liability coverage, consumers who can afford higher premiums choose to purchase more coverage. Higher levels are purchased to protect consumers from expensive repair bills, medical bills and lawsuits.

Uninsured/Underinsured Motorist

Coverage: Uninsured motorist coverage will protect you if a hit-and-run driver or someone driving without insurance causes damage to your property or injures you or your passenger(s).

For example, this coverage will pay for repairs to your property, as well as your and your injured passenger’s medical expenses, lost wages, pain and suffering. This coverage is not mandatory under Maryland auto insurance law.

Underinsured motorist coverage, which protects you when another driver causes an accident but does not have enough insurance to pay your claims, provides the same protection. This coverage is not mandatory under Maryland auto insurance law.

Personal Injury Protection (PIP)

Up to the specified dollar amount of your coverage, PIP coverage will reimburse you (or others named on your policy) for reasonable and necessary medical expenses resulting from an auto accident.

PIP coverage also will reimburse your (or others named on your policy) lost wages associated with an auto accident. This reimbursement will be made regardless of who caused the accident. This coverage is not mandatory under Maryland auto insurance law.

PIP coverage can be denied if claims are not properly and timely filed with your insurance company. Therefore, it is important to contact your insurance company or agent immediately after an accident has occurred and request PIP forms be sent to you.

Because PIP coverage may duplicate an individual’s health care coverage, some consumers opt to waive PIP if they feel they have adequate health care coverage and/or can afford to pay for medical treatment.

Although waiving PIP may result in a lower premium, consumers should keep in mind that PIP also pays lost wages and your passengers’ medical expenses, which are not covered under health care policies.

What Other Coverages Are Available?

Physical Damage Coverage, also referred to as comprehensive and collision coverage, is the most commonly recognized coverage as it protects you from expenses related to damage to or loss of your vehicle (e.g. accidents that you cause, theft or vandalism).

Although Maryland auto insurance law does not require you to purchase physical damage coverage, often banks and other financial institutions that lend you money to purchase your car do require you to purchase both collision and comprehensive coverage.

Collision Coverage will pay to repair your vehicle or will pay you what your vehicle was worth right before an accident occurred (if your company determines the car is totaled). Collision coverage is applicable regardless of who caused the accident.

Because collision coverage is usually the most expensive component of your auto insurance premium, many people may choose to purchase collision coverage with a high deductible. This coverage is not mandatory under Maryland auto insurance law.

Comprehensive Coverage¬†(also known as “Other Than Collision”) will pay for damage to your car resulting from causes other than an accident, such as vandalism or theft. As with collision coverage, choosing a higher deductible will lower your insurance cost. This coverage is not mandatory under Maryland auto insurance law.

For further questions, contact Drivers License Attorney in Baltimore, MD.