Why Do Insurance Companies Refuse to Pay UM/UIM Claims in Maryland?

What Is Uninsured Motorist Coverage in Maryland?

Uninsured motorist coverage is considered first-party insurance. For related disputes, see insurance claim denial cases. Like health insurance or disability insurance, it is your insurance. You pay the premiums. You have a policy with your insurance company. Your insurance company owes you some duties of fair dealing. If a covered loss happens, you may look to your own policy to make you whole and compensate you for your losses. This is different from liability insurance, which is third-party coverage under which you look to the at-fault driver’s insurer for payment.

Uninsured motorist coverage comes into play when the at-fault driver has no liability insurance, cannot be identified, or there is otherwise a qualifying uninsured situation under Maryland law.

This page focuses on uninsured and underinsured motorist insurance disputes. For broader accident liability claims, see Baltimore car accident lawyer.

What Is the Difference Between Uninsured and Underinsured Motorist Coverage?

Because of the way Maryland law treats these benefits, the same broad coverage structure and statute often addresses two different problems. The first is the classic uninsured situation, where the at-fault driver has no liability insurance at all, or is a “disappearing” “fleeing” “phantom” motorist. The second is the underinsured situation, where the at-fault driver has insurance, but not enough to fairly compensate the injured person.

What Types of Auto Insurance Claims Does This Page Cover?

This page is focused on injury-based uninsured and underinsured motorist claims. That includes claims involving denied UM/UIM benefits, underpaid claims, lowball offers, disputes over available coverage, disputes over value, and litigation involving a carrier’s refusal to fairly pay benefits owed under a first-party automobile policy.

It does not primarily focus on ordinary third-party liability claims against the at-fault driver. From more than 30 years I have represented thousands of people injured in automobile accidents through the negligence of another. These are considered personal injury claims. I have covered those topics extensively in the Baltimore car accident lawyer and broader personal injury sections of the site. If your claim is primarily a liability case against the other driver, those pages are the better starting point.

It also does not focus on small, stand-alone property-damage disputes. If the issue is a straight collision or comprehensive claim involving only a few thousand dollars in vehicle damage, such as a damaged bumper, light post, or unattended vehicle, that is generally not the type of claim I handle. The dollar values involved in these cases typically don’t warrant retaining counsel. The claims I handle and litigate are denied, delayed, underpaid, lowball-offer, uninsured, and underinsured motorist injury claims.

How Do Uninsured and Underinsured Motorist Claims Work in Maryland?

Traditional uninsured motorist coverage generally comes into play only after the limits of all available underlying coverage have been exhausted. In a pure uninsured situation, that is easier to understand because there is no underlying liability insurance. In an underinsured situation, the process is more technical because the amount paid by the at-fault liability carrier can affect whether traditional UM/UIM money is still available.

The practical issue is not whether coverage exists—it is whether the insurance company will pay it.

Consider a common example. If the at-fault driver has $30,000 in liability coverage and the injured person also has only $30,000 in traditional UM/UIM coverage, there is often no additional traditional UM/UIM pool after the $30,000 liability payment is exhausted. By contrast, if the injured person has $60,000 in traditional UM/UIM coverage and the at-fault driver has only $30,000 in liability coverage, there may be an additional $30,000 pool potentially available.

Maryland also allows motorists to elect enhanced underinsured motorist coverage. With enhanced coverage, the mechanics are materially different, and the at-fault driver’s payment is not treated the same way as under traditional coverage. That difference can matter greatly in a serious injury case. 

How Do I Make a Claim for Uninsured or Underinsured Motorist Benefits?

The starting point is usually the exhaustion of the underlying liability policy. In practice, that often means the at-fault insurer offers its limits in exchange for a release of its insured. Your UM/UIM carrier then generally has options relating to consent, substitution of payment, and preservation of subrogation rights. This is one of the places where many otherwise good claims go sideways because the paperwork, timing, and releases matter.

If the claim involves significant personal injury, medical expenses, wage loss, or a disputed valuation, the procedure can become mind-bending quickly. That is particularly true when one carrier points to another, when the UM/UIM carrier questions damages, or when consent-to-settle and exhaustion issues are mishandled.

What Happens if My Insurance Company Refuses to Pay My UM/UIM Claim?

That is where a first-party insurance dispute begins to look very different from a simple liability claim. You may reasonably ask why you paid premiums for years if your own carrier then refuses to fairly evaluate, promptly pay, or honestly process the claim. In some cases, Maryland law provides an administrative path through the Maryland Insurance Administration before a Circuit Court action is pursued. In a proper case, the issues may include whether coverage exists, how much should be paid, and whether the carrier failed to act in good faith.

These are precisely the kinds of claims that call for counsel. I handle denied, delayed, underpaid, and lowball-offer UM/UIM claims involving personal injury. These disputes often involve bad faith insurance conduct depending on how the claim is handled. If the issue is a serious injury claim and the carrier is not paying fairly, that is the kind of dispute this page is designed to address.

What Types of Claims Can Be Covered by UM/UIM Coverage?

The law requires motor vehicle policies written in Maryland to contain uninsured motorist protection unless the insured makes a qualifying written election permitted by statute. But that does not mean every crash involving an unidentified or disappearing driver is automatically covered. The process is often more elaborate, and the requirements are more stringent.

UM/UIM issues can arise in cases involving:

• drivers with no insurance at all;
• drivers with insurance that is too low to fairly compensate the injured person;
• hit-and-run or phantom-vehicle situations where identification becomes the central problem;
• situations where the at-fault driver is known but later disappears and service or insurance confirmation becomes impossible; and
• cases where your own carrier disputes whether the event even qualifies at all under the policy or Maryland law.

Note the recurring theme: proof matters. If a driver fled the scene, your carrier may still demand proof that all reasonable efforts were made to identify the vehicle, owner, driver, or available coverage. Witnesses, crash-scene photographs, nearby business cameras, 911 calls, and prompt reporting can become decisive.

Is Enhanced Underinsured Motorist Coverage Offered in Maryland?

Yes. Maryland enacted statutory provisions requiring carriers writing private passenger automobile insurance in this state to offer enhanced underinsured motorist coverage. That option became available for qualifying policies beginning in 2018. The major practical distinction is that enhanced coverage does not operate like traditional UM/UIM coverage with the same old setoff problem.

Under the older straight-coverage model, one often had to carry more UM/UIM coverage than the at-fault driver’s liability limits to access any meaningful additional benefits. With enhanced underinsured coverage, the structure is different. That can make a major difference in serious injury litigation and settlement leverage.

What If I Was Driving Without Insurance at the Time of the Crash?

If you were operating a vehicle without the required insurance, you may have violated Maryland’s transportation laws. But that does not automatically mean you lose a negligence claim against the at-fault driver. If another person caused the crash and you did not contribute to it, your lack of insurance, standing alone, is not the same thing as causing the collision.

That said, there is a hard practical problem. If you had no insurance at all, then the first-party benefits that normally live inside your own policy—such as PIP and UM/UIM—may not be available to you. That can remove major sources of recovery that otherwise would have existed. Maryland contributory negligence remains the dominant risk issue in any bodily injury case. If you contributed to the crash in even a legally sufficient way, that can bar recovery entirely.

Three Must-Take Steps After a Baltimore Car Accident When UM/UIM May Be in Play

• Report the crash to your own carrier and police promptly. Your policy typically requires cooperation and notice, and PIP or UM/UIM issues may be implicated immediately.
• Preserve evidence before it disappears. Photograph the vehicles, tags, insurance information, scene, debris, signage, and visible injuries. Identify witnesses and nearby cameras immediately.
• Review your declarations page. Confirm whether you carry PIP, traditional UM/UIM, or enhanced underinsured motorist coverage, and note the actual limits.

For broader liability-claim guidance after a crash, see my Baltimore car accident lawyer page and related personal injury resources. This pillar page is focused on the first-party UM/UIM side of the insurance problem.

Understanding how fault is determined may affect how UM/UIM claims are evaluated.

If your uninsured or underinsured motorist claim is being denied, delayed, or underpaid in Baltimore, the issue is no longer just the accident—it is the insurance company’s obligation to pay.

Speak With Eric T. Kirk About a Baltimore UM/UIM Claim

Cases I Typically Handle

• denied uninsured motorist claims
• underinsured motorist disputes
• bad-faith insurance conduct
• lowball settlement offers
• litigation involving UM/UIM coverage

Claims I Do Not Typically Handle

• minor vehicle damage claims
• collision-only insurance disputes
• comprehensive claims involving a few thousand dollars of damage

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• Baltimore Insurance Claims Denial Lawyer

Eric T. Kirk Baltimore Personal Injury Trial Lawyer

For over three decades, I have battled against the nation’s largest insurance companies, always endeavoring to ensure my clients receive the compensation they deserve. As lead counsel in thousands of cases across Maryland, New York, and Florida, I have recovered millions for clients whose claims were wrongfully denied and delayed. Whether denying fair compensation for a personal injury victim or denying benefits to a homeowner, Insurance companies employ policy exclusions, technicalities, and lowball offers to deny and defeat claims. They also hire very good lawyers to fight you in court. So should you. When an insurance company unfairly rejects a claim, I stop them.

www.thekirklawfirm.com/

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For the last 30 years, I’ve battled the insurance industry to ensure my clients receive full, fair and just compensation. I’ve secured millions of dollars for my clients after litigating claims that were denied or undervalued by their insurance company.

“When an insurance company unfairly denies, rejects or undervalues a claim, I stop them.”

— Eric T. Kirk

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