Maryland Auto Insurance: Tax Refund Garnish

In Maryland, auto insurance is mandatory and drivers must maintain a certain level of liability insurance. This insurance policy must include a minimum of $30,000 to cover injuries or death to one person, $60,000 to cover injuries or death to more than one person in a single accident, and $15,000 to cover damage to property. Driving without insurance in Maryland is illegal and can result in fines, penalties, and even the confiscation of license plates. If motorists fail to respond to insurance notifications, their income tax refunds can be intercepted by the state's Tax Refund Intercept Program (TRIP).

Maryland auto insurance laws and requirements

Maryland has specific auto insurance laws and requirements that drivers must follow to remain legal. Here is a comprehensive overview:

Minimum Liability Coverage:

Maryland requires a minimum liability coverage of 30/60/15. This includes:

• $30,000 for bodily injury per person.
• $60,000 for bodily injury per accident.
• $15,000 for property damage per accident.

Uninsured/Underinsured Motorist Protection:

Maryland also requires uninsured/underinsured motorist coverage, with identical limits to the liability coverage:

• $30,000 for bodily injury per person.
• $60,000 for bodily injury per accident.
• $15,000 for property damage per accident.

This coverage protects you if you are in an accident caused by a driver with insufficient or no insurance. Maryland is unique in mandating uninsured motorist property damage coverage (UMPD) for vehicle repairs.

Personal Injury Protection (PIP):

Personal Injury Protection (PIP) is also required in Maryland, unless waived in writing. It covers medical expenses and lost income for you and your passengers, up to $2,500 per person, regardless of fault. Full PIP covers family members and non-family passengers, while limited PIP excludes benefits for family members aged 16 and over and is more suitable for those with good medical insurance.

Liability Insurance Coverage:

Liability insurance is legally required in Maryland. It covers injuries, lost wages, and pain and suffering caused to another driver or their passengers in an accident, as well as damage to their vehicle. It's important to remember that liability coverage doesn't pay for your own injuries or vehicle damage.

Proof of Insurance:

Drivers in Maryland must carry proof of insurance while driving and present it upon request by law enforcement. Failure to do so can result in penalties, including fines and imprisonment.

Optional Coverages:

While the above-mentioned coverages are mandatory, Maryland drivers may also consider additional optional coverages for enhanced protection:

• Comprehensive coverage for damage caused by weather events, theft, and non-collision incidents (including collisions with animals).
• Collision coverage for damages resulting from colliding with another object or vehicle, regardless of fault.
• Loan/Lease Payoff coverage, which is beneficial if your vehicle is totaled and helps pay the difference between the actual cash value and the remaining loan amount.
• Rental Car Reimbursement to cover rental car costs if your vehicle is inoperable.
• Roadside Assistance for towing, flat tires, and dead batteries.

Maryland also has specific penalties for driving without insurance and is a diminished-value state, allowing drivers to recover diminished value from the at-fault party's insurance company.

Penalties for uninsured vehicles

In Maryland, driving without insurance is a serious offence. It is against the Financial Responsibility Law to drive without the minimum required car insurance coverage. The minimum insurance coverage required by Maryland state law is $30,000 for bodily injury per person, $60,000 for bodily injury per accident, and $15,000 for property damage per accident.

If you are caught driving without insurance in Maryland, you could face heavy fines and even jail time. The penalties vary depending on the circumstances and whether it is a first or repeat offence. For a first offence, you could be fined up to $1,000 and face up to one year in prison. For a second offence, the fine increases to a maximum of $2,000, and you could face up to two years in prison. In addition to these criminal penalties, there are also administrative penalties for an insurance lapse, including fines, fees, and the loss of driving privileges until all insurance violations are cleared and fines are paid.

It is important to note that even if you are unaware of a lapse in your coverage, you can still be penalised. Insurers are required to report to the Motor Vehicle Administration (MVA) when a policy has been cancelled or not renewed, and Maryland state law has a system of automatic fines for lapses. Therefore, it is crucial to maintain valid car insurance coverage at all times and to turn in your tag if you plan on cancelling your insurance to avoid penalties.

Proof of vehicle insurance

In most of the United States, drivers must have automobile liability insurance to legally drive a vehicle. Most states also require drivers to carry proof that they are covered. This is known as "financial responsibility" and is required on all vehicles operated or parked on California roadways. Driving without proof of insurance puts you at risk of tickets and fines.

To prove that you comply with your state’s law, you are supposed to carry proof of insurance with you whenever you’re driving. If you are stopped by the police, they can ask to see your proof of insurance along with your license and registration. You will also need it if you are ever in an accident.

Proof of insurance can be in the form of an insurance ID card or other document from your insurance company. To meet the proof of insurance requirements, your ID card or form must show the policy number, policy effective dates, covered vehicle, and policyholder name.

In addition to the standard proof of insurance, some drivers will need an SR-22 form, also known as a certificate of financial responsibility. In Virginia and Florida, the form is known as an FR-44.

When you purchase a car insurance policy, the insurance company will typically send you proof of insurance right away. You may also be able to download a temporary insurance card to use until the hard copy arrives.

You’ll receive a new insurance card every time your policy renews, or whenever you make changes to your coverage. When you receive a new insurance card, shred and throw out your old card and put the new one in your vehicle so you can prove that your insurance is up to date.

You may also want to photograph or make a photocopy of your latest card and keep it apart from your car, just in case.

In most states, proof of insurance is also available in electronic form. So if you’re stopped by law enforcement, you can show them a digital insurance card on your smartphone.

Maryland Auto Insurance

Vehicle owners in Maryland must carry at least the minimum required limits of coverage in order to drive legally. If your insurance policy is cancelled, you are subject to uninsured driver penalties, which are assessed at a rate of $150 for the first 30 days and then $7 per day afterward. These penalties can add up to $2,500 per year, per vehicle.

If you’ve recently lost auto insurance coverage, you may receive a letter regarding the suspension of your registration. The Maryland Department of Transportation Motor Vehicle Administration (MDOT MVA) notifies the Uninsured Division of Maryland Auto when a registration has been suspended because the insurance policy has lapsed or been cancelled.

If you are due to receive a refund from your Maryland tax return, all or part of your refund may also be intercepted as part of the state’s Tax Refund Intercept Program (TRIP).

Accidents and insurance

Accidents can happen at any time, and they often come with a lot of unexpected costs. Accident insurance is a type of supplemental health insurance that provides financial protection in the event of an accident. It helps cover the unexpected medical expenses and other costs that can arise as a result of an accident, such as out-of-pocket costs, transportation services, and more. It is important to note that accident insurance is not a substitute for regular health insurance coverage and cannot replace short-term health insurance while travelling abroad. However, it can provide additional peace of mind and financial relief during covered accidents.

Accident insurance policies typically provide coverage for a wide range of accidents, including those that occur on the job, at home, or during sports or recreational activities. The benefits are usually paid directly to the policyholder, not the medical provider, and the amounts vary depending on the nature of the accident and the specific terms of the policy. Some policies may also cover accidental death, providing additional benefits to supplement other life insurance policies.

When shopping for accident insurance, it is important to ask about premiums, coverage limits, and the types of accidents and events that are covered. It is also worth getting to know the company's reputation, as some companies cover more than others and some may delay payments until they are satisfied that the terms for a payout have been met. Accident insurance can be purchased as a standalone policy or bundled with an existing insurance policy.

In the context of auto insurance in Maryland, it is important to note that vehicle owners are required by law to carry at least the minimum required limits of coverage to drive legally in the state. Driving without insurance can result in significant penalties, including fines and the suspension of registration. If an accident occurs while driving without insurance, the driver may be personally responsible for any damages. Therefore, maintaining adequate auto insurance coverage and understanding the benefits of supplemental accident insurance can provide financial protection and help avoid legal consequences in the event of an accident.

Getting insured in Maryland

If you're an uninsured driver in Maryland, you may be subject to fines and penalties. The Maryland Department of Transportation Motor Vehicle Administration (MDOT MVA) requires vehicle owners to carry at least the minimum level of auto insurance coverage to drive legally in the state. Failure to do so can result in fines of $150 for the first 30 days, followed by an additional $7 per day, accumulating to $2,500 per year, per vehicle. These penalties can be resolved through payment plans offered by the MDOT MVA's Insurance Compliance Division.

To get insured in Maryland, you can explore the following options:

• Contact your previous insurance provider: If your policy was cancelled or lapsed, you can reach out to your previous insurance agent or company to reinstate your policy.
• Find a new insurance provider: If you prefer to switch insurers, you can use resources like the Maryland Insurance Administration's website to find a list of insurance providers. Websites like WalletHub also allow you to compare quotes from different companies to find the most affordable option.
• Maryland Auto Insurance: If you meet the eligibility requirements due to a cancelled policy, you may be able to obtain a policy through Maryland Auto Insurance. They offer an interest-free instalment payment plan to help make insurance more affordable.

It's important to maintain continuous auto insurance coverage in Maryland, as letting your insurance lapse can result in higher rates when you reinstate your policy. Additionally, driving without insurance can lead to significant penalties and personal liability in the event of an accident.

If you are unable to afford auto insurance, you can return your vehicle tags to the MDOT MVA to resolve the issue.

Frequently asked questions