Maryland Uninsured Motorist Coverage: Penalties, Claims, and MAIF

Maryland uninsured motorist coverage is mandatory on every auto policy sold in the state, and the minimum limits match the state’s liability minimums: $30,000 for one person’s bodily injury, $60,000 total per accident, and $15,000 for property damage.¹ You cannot buy a Maryland policy without it, and letting your coverage lapse triggers automatic registration suspension plus fines that can reach $3,500 per vehicle per year.

What UM Coverage Must Include

Under Insurance Code Section 19-509, every auto policy issued in Maryland must cover damages caused by uninsured drivers, including bodily injury, death, and property damage with loss of use of your vehicle.² Policies must list uninsured motorist bodily injury (UMBI) and uninsured motorist property damage (UMPD) as separate line items.³

The coverage applies in two situations. The obvious one: the at-fault driver has no insurance. The less obvious one: the at-fault driver had insurance, but their liability limits have already been reduced by payments to other claimants from the same crash to an amount below your UM limits.² In that second scenario, your own UM coverage fills the gap.

Enhanced Underinsured Motorist Coverage

Maryland added a stronger layer of protection called Enhanced Underinsured Motorist (EUIM) coverage through House Bill 5, enacted in April 2017 and applying to policies issued on or after July 1, 2018.⁴ Under Insurance Code Section 19-509.1, insurers must provide EUIM on every private passenger policy unless you affirmatively waive it in writing.⁵

EUIM matters because of what it does not subtract. Basic UM coverage offsets whatever the at-fault driver’s insurance already paid. EUIM pays its full amount on top of that payout, so you effectively collect the at-fault driver’s liability payment plus your full EUIM limit. The coverage amount automatically equals your liability limits.

If you did not sign a written waiver, you have EUIM by default. The waiver form must be in at least 14-point boldface type and spell out the nature, cost, and benefit of what you’re declining. An insurer cannot refuse to write your policy because you keep EUIM.⁵ Maryland does not allow stacking, so you cannot combine EUIM amounts from multiple vehicles or policies to raise your total payout.⁶

Waiving UM Limits Above the Minimum

You cannot drop UM coverage altogether, but you can keep it below your liability limits. Under Insurance Code Section 19-510, when your liability limits exceed the state minimums, your insurer must automatically set your UM coverage equal to those higher limits unless you sign a written waiver.⁷

The waiver must be on a form prescribed by the Insurance Commissioner, in 10-point boldface type, explaining what coverage you’re giving up and what it would cost. Your insurer cannot cancel or decline to renew your policy for refusing to sign. Once signed, the waiver carries forward on renewals and replacement policies until you withdraw it in writing.⁷ If you signed either waiver years ago, it is probably still in effect. Ask your insurer for a copy of your declarations page and any signed waivers to see where you actually stand.

What Happens If Your Insurance Lapses

Your insurer is required to notify the MVA electronically when your coverage terminates, so the state usually knows about a lapse before you do. Your vehicle registration is automatically suspended the moment coverage ends.⁸ Once notified, you have 48 hours to surrender your plates. Miss that window and the MVA can suspend your driver’s license until you return them.

Fines accrue whether or not you drive the vehicle. The MVA assesses $200 for each vehicle that goes uninsured for 1 to 30 days. From day 31 forward, the penalty adds $7 per day. The maximum is $3,500 per vehicle per 12-month period, and each separate lapse counts as its own violation.⁸ To restore your registration, you must get new insurance, show the MVA proof of it, pay the accumulated penalties, and pay a restoration fee of up to $25.⁹

One narrow exception exists. If you return your plates within 10 days of the lapse and the vehicle was sold, you moved out of state, a salvage certificate was issued, or a licensed dealer took possession, the MVA cannot assess the penalty.⁸

Criminal Penalties for Driving Uninsured

Knowingly driving or allowing someone else to drive a vehicle without the required insurance is a separate criminal offense under Section 17-107. A first conviction carries up to one year in jail, a fine of up to $1,000, or both. A second or later offense doubles the maximum jail time to two years, with the same $1,000 fine cap.¹⁰ These criminal penalties apply in addition to the MVA’s administrative fines, not instead of them.

Filing a UM Claim

When an uninsured or underinsured driver hits you, the claim goes through your own insurer, not the other driver’s. File a police report first. It documents the crash independently and helps your insurer verify the other driver had no coverage. Then notify your insurance company as soon as you can. Most policies require prompt notice, and avoidable delay can give the insurer grounds to challenge the claim.

Your insurer will investigate the crash, confirm the other driver’s insurance status, and assess what you’re owed. Expect to provide medical records and bills, repair estimates or invoices, proof of lost wages, and other evidence of your losses. The insurer then makes a settlement offer within your policy limits.

If you disagree with the offer, you can negotiate, request arbitration where the policy allows it, or sue. For policies issued on or after July 1, 2018, insurers cannot require binding arbitration for underinsured motorist disputes, so you keep the right to go to court if negotiations fail.⁴

Two Maryland Rules That Can Kill a Claim

Maryland is one of only five U.S. jurisdictions that still applies contributory negligence, which completely bars recovery if you were even partially at fault for the crash.¹¹ In most states, being 10% at fault reduces your recovery by 10%. In Maryland, 1% can wipe it out. If your UM claim ends up in litigation, establishing that the uninsured driver was solely responsible is essential.

The statute of limitations for personal injury in Maryland is three years from the date of injury. Miss it and you lose the right to sue. Minors and people lacking legal capacity may have a later start date. The three-year deadline applies to lawsuits rather than to the insurance claim itself, but waiting to file the claim creates its own problems as evidence fades and insurers grow skeptical of late reports.

If No Private Insurer Will Cover You

Maryland runs a state-chartered insurer of last resort called the Maryland Automobile Insurance Fund (MAIF). You qualify to buy coverage through MAIF if at least two private insurers have rejected you, or if your policy was canceled or non-renewed for any reason other than nonpayment of premiums.¹² MAIF premiums tend to run higher than standard-market rates, so it works best as a bridge back to a private carrier once your record allows.

1
Maryland Department of Transportation Motor Vehicle Administration. Insurance Requirements for Maryland Vehicles
2
Maryland General Assembly. Maryland Code Insurance 19-509 – Uninsured Motorist Coverage — in General
3
Maryland Insurance Administration. What You Need to Know About Uninsured Motorist Claims
4
Maryland General Assembly. 2017 Regular Session – House Bill 5 Chapter
5
Maryland General Assembly. Maryland Code Insurance 19-509.1 – Enhanced Underinsured Motorist Coverage
6
Maryland Insurance Administration. Consumer Advisory – Enhanced Underinsured Automobile Insurance Coverage
7
Maryland General Assembly. Maryland Code Insurance 19-510
8
Maryland General Assembly. Maryland Transportation Code 17-106 – Lapse or Termination of Required Security
9
Maryland Department of Transportation Motor Vehicle Administration. Uninsured Vehicle Owners
10
Maryland General Assembly. Maryland Code 17-107 – Prohibitions
11
Department of Legislative Services. Negligence Systems – Contributory Negligence, Comparative Fault, and Joint and Several Liability
12
Maryland State Archives. Maryland Automobile Insurance Fund – Origin and Functions