One area that we often touch on in our blog articles is auto insurance. In January of this year we discussed the topic of how much insurance coverage you should think about covering on your liability policy.
Another component of insurance that we haven’t spoken about is uninsured or underinsured motorist coverage (“UM or UIM”). Everyone is required to carry it in Maryland and as a default, your UM/UIM coverage limits mirrors that of your liability limits. So, if you carry $100,000.00 in liability coverage, you also have $100,000.00 in UM/UIM coverage. This means if someone who has no insurance, or limits under $100,000.00 causes injury to you or your passengers in your car, you can recover up to the limits of your UM/UIM policy. So, for example, if the at-fault driver has a $30,000.00 policy and your damages exceed that, you can pursue a claim under your UIM policy for up to $100,000.00. It is important to note that you do not get to “stack” the two and get $130,000.00. Your recovery is capped at your UM/UIM policy limits and you can recover the difference between the at-fault party’s liability policy and your UM/UIM policy from your insurance company. Which, in this example is $70,000.00 (100,000 – 30,000).
In Maryland, these UM/UIM limits have been capped at your policy limits, no matter how many vehicles you have insured. So, using the same example above, even if you have 3 vehicles under that policy, you are capped at $100,000.00 cannot stack the policies on each insured vehicle for a total of $300,000.00. Some states allow this and it is a huge benefit to individuals injured by someone else who carries no or very little insurance. The difference in have $100,000.00 in possible recovery versus $300,000.00 can be very important if you’re dealing with serious injuries.
Beginning July 1, 2018 in Maryland, you can purchase Enhanced Underinsured Motorist (“EUIM”) coverage on all NEW automobile policies issued in Maryland. You may be able to also add this coverage on existing Maryland automobile, but this option will vary depending on your insurance company.
We strongly encourage you to contact your insurance agent to see if this coverage is available to you under your existing policy and if you are purchasing a new policy of insurance, you should look into EUIM coverage.
Horman Nichols, LLC 