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Maryland Car Insurance Guide

Here's what you need to know...
  • In Maryland, liability auto insurance is mandatory for all drivers
  • If you cancel your car insurance, you must return your license plates to the Maryland MVA
  • Driving without insurance in Maryland can lead to registration suspension and fines
  • Minimum coverages are $30,000/$60,000 for bodily injury and $15,000 for property damage
  • When moving from another state, you must convert your policy to Maryland coverage

All vehicles registered in Maryland must be insured by an insurance company that is licensed to do business in the state.

The minimum required amounts of car insurance coverages in Maryland include:

If you decide to stop driving a vehicle permanently, you can return your license plates to Maryland’s Motor Vehicle Administration (MVA) office, and you do not have to keep insurance coverage on the vehicle.

Likewise, if you move out of the state, you should either return your license plates or notify the MVA office with the information regarding your move.

In addition to the proper moving information, you will need to provide the MVA with proof of your out of state registration.

When moving to Maryland from another state, you must obtain Maryland vehicle insurance. You can continue your current coverage by converting it to a Maryland policy if your insurer is licensed in the state of Maryland. Otherwise, you must obtain insurance from a Maryland insurance company.

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In Maryland, if you drive without adequate insurance coverage, you may receive the following penalties:

  • You may be required to pay a minimum fine of $150 for the first 30 days or a maximum fine of $2,500 per vehicle annually.
  • Your vehicle registration may be suspended.
  • Your car may be impounded.
  • If you do not respond to MVA insurance notifications, your case may be transferred to the Central Collections Unit (CCU).
  • If your case is sent to the CCU, your car may be subject to an additional 17 percent collection fee.
  • Your unpaid collection fees may result in the interception of your tax return.

Types of Coverage Available

AdobeStock_66413216-1600x1600Car insurance in Maryland consists of a number of different types of coverage. Although some types are required, drivers are free to choose any additional coverages.

– Liability Coverage

Liability insurance, which is mandatory in Maryland, is the portion of your coverage that pays for damages to someone else’s property when you are at-fault in an accident.

Beyond protecting you, it covers other members of your household and those that you allow to drive your car. Additionally, liability coverage will pay for your legal defense if you are sued because of a car accident.

Liability insurance is divided into the following two types of coverage:

  • Bodily injury – Bodily injury liability covers deaths or injuries sustained by the pedestrians or passengers involved in a car accident. In addition, this coverage will pay for any medical expenses, pain and suffering, and loss of income that results from an accident.
  • Property damage – Property damage liability pays for any damages to another person’s car or property when the damages are the result of an accident that you cause. The types of property that are insured under this coverage are buildings, utility poles, fences, and trees.

– Uninsured and Underinsured Motorist Coverage

Uninsured motorist coverage, which is mandatory in Maryland, protects you from uninsured or underinsured drivers who cause an accident in which you are involved.

This coverage pays for any damages that an uninsured or underinsured driver causes to you, your property, or passengers in your vehicle.

Maryland’s insurance laws require coverage in the amounts of $30,000 per person and $60,000 per accident in bodily injury, as well as $15,000 per accident for property damage.

– Personal Injury Protection

Regardless of who is at fault, Personal Injury Protection (PIP) provides coverage for medical expenses and lost income due to a car accident. The minimum PIP coverage is $2,500 in Maryland, but drivers can purchase additional amounts.

– Collision Coverage

Collision coverage pays for repairs to your insured vehicle or for replacement if your vehicle is damaged beyond a certain percentage, which is specified by your insurance company.

Although collision insurance does not consider who caused the accident, you will have to pay a deductible before the coverage applies.

– Comprehensive Coverage

Comprehensive coverage pays for damages that occur outside of an auto accident. Such damages include vandalism, theft, hail, glass breakage, or collision with an animal.

If your car is older or has a very low value, comprehensive coverage may not be worth the additional cost.

– Rental Reimbursement

Rental reimbursement pays up to $25 per day and $750 per claim for renting a car while your covered car is being repaired or replaced after an accident. The amount that is reimbursed is generally paid for a maximum of 30 days.

– Transportation Expense

Transportation expense coverage will pay for train or bus fare when your car is being repaired following an accident or other loss.

– Towing

Towing coverage ensures that your car is towed to a repair facility following an accident or breakdown. In Maryland, this coverage also includes the following:

  • Tire change
  • Battery charge
  • Locksmith service
  • Gas, coolant, and other emergency supplies

– Medical Payments Coverage

Medical payments insurance will give you money for expenses due to an accident regardless of who is at fault. This coverage is additional to PIP benefits.

– GAP Insurance

GAP insurance covers any difference in the loan amount for your car and what the insurance company pays off in the event of a total loss.

If you owe more on your loan than what your car is worth after an accident, this coverage will pay the difference. GAP coverage prevents you from having to make payments on a vehicle you no longer have.

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Choosing the Coverage That Fits Your Needs

Even though minimum insurance limits are set, reviewing coverages and limits is wise. If you decide the coverages that you have aren’t enough for your current financial situation, your car’s value, and the amount of risk you are willing to take, you can purchase optional coverages, like the ones explained above.

A serious accident can easily exceed the 30/60/15 minimum limit for property damages, so purchasing higher coverage, and possibly additional types of coverage, is a smart decision.

Saving Money on Maryland Car Insurance

AdobeStock_3577702-1600x1600There are many elements that can affect the price you pay for your Maryland car insurance. The type of car you drive is important. Driving a vehicle that is not a sports car or a highly-stolen vehicle will save you money on your premiums.

If you have a vehicle that is not worth much, you can opt to purchase only the required types of auto insurance at the minimum amounts.

Likewise, raising your deductible can save you considerable amounts of money but can also be risky in the long run.

Your driving record factors into your insurance premium calculation, so avoid getting tickets and citations as much as possible.

Additionally, your credit reports are now used in determining your insurance premiums. If you keep your credit score high, you may be able to save more money.

Types of Discounts

AdobeStock_76267159-1600x1600Many different types of discounts are available for car insurance, so make sure that you take advantage of as many as possible. Ask your company if they offer multi-car discounts when you insure your vehicles.

Many insurers also offer multi-policy discounts, so if you have homeowners or renters coverage, you might want to check coverage charges with the same company.

Many insurance companies also offer discounts for paying your vehicle coverage in full each year or policy period. Loyalty discounts are frequently available as well.

Advantages of Comparison Shopping

Insurance premiums and coverages can vary widely from one insurance company to the next, so comparison shopping is always wise.

Be sure to review your coverages annually, at the least, as well as any time you and your family undergo a life change, such as getting a new car or adding a driver to your household.

By comparing your options, you will be sure to get the most value for your insurance dollars.

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