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Big Changes in Maryland Car Insurance Law

First, a preliminary disclaimer. This article is longer than usual, but deals with some important changes in the law. Please read all the way through. Every situation is different, and this article should not be construed as legal advice. With regards to new insurance products, please contact your insurance agent for the best advise for your situation. If you been in a Maryland car accident, please contact us.

Maryland’s car insurance laws changed in a big way on July 1, 2018. Maryland now has something called “Enhanced Underinsured Motorist” Coverage, and it can be added to new policies as of July 1, 2018.

What is this “Enhanced” Coverage? First, let’s discuss the basics, which we previously discussed more here. If you are in an accident and not at fault, the other party (if they are a Maryland Driver) is required to carry at least $30,000 insurance to cover your damages, which may include medical bills, lost wages, pain and suffering, and so on. If they don’t have insurance at all, then your “Uninsured” coverage kicks in, which I discuss more here.

Some states, such as Pennsylvania and West Virginia, require lower minimum coverage amounts. If you are in an accident with an out-of-state driver, you should call us immediately, as those kinds of cases can be tricky.

But what if your damages exceed $30,000? When you purchase car insurance can add what is known “Underinsured Motorist” or “UIM” coverage.

For example, let’s say you are in a really bad accident, and the other party only has the minimum $30,000 in insurance available. But, you were prepared and purchased UIM coverage in the amount of $100,000. You can make a claim against that $100,000 policy.

But, there is a catch! With regular or old UIM, if you purchased $100,000 in coverage, the most you could recover in total is $100,000.  If the other party paid their $30,000, the most you can get from your UIM coverage is $70,000.

This all changes with Enhanced UIM, also known as “Stacking” UIM in the business. If you purchase $100,000 in UIM coverage, you get $100,000 in coverage regardless of what the other party had for insurance. So now, if the at-fault party had $30,000 in coverage, and you have $100,000, you can collect up to $130,000 in damages. If the other party had $100,000 in coverage, and you have $100,000 in Enhanced UIM, you can collect to $200,000.

To sum up:

UIM Coverage – You can collect up to the amount of your own policy. For example, if the at-fault party has $50,000 in coverage, and you have $50,000 in UIM coverage, you can collect a total of $50,000. (certain conditions apply)

Enhanced UIM – You can add your coverage to whatever you get from the at-fault party. If the at fauly party has $50,000 in coverage, and you have $50,000 in Enhanced UIM, you can collect up to $100,000 total. (certain conditions apply)

So, ask your insurance carrier or agent about new Enhanced UIM, and if you have enough insurance coverage to protect yourself and your loved ones. Enhanced UIM is only available on policies written or renewed on or after July 1, 2018.

This article/blog post should not be construed for legal advice, nor does it create an attorney client relationship. All cases are different, and only a skilled lawyer can properly assess your case. If you’ve been in a car accident, do not hesitate to contact us. We are your Maryland car accident attorneys.

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