O’Malley signs higher auto liability limits into law in Maryland

May 4th, 2010 | By Hot News Reporter | Category: Insurance Today

(IFAwebnews) – Beginning Jan. 1, Maryland residents will be paying more for auto insurance under a new measure signed into law by Gov. Martin O’Malley.

Today (May 4), O’Malley put his signature to a series of new laws, including HB 825. The new law increases the minimum amounts of coverage for bodily claims or death from a motor vehicle accident from $20,000 to $30,000 for one person, and from $40,000 to $60,000 for any two or more individuals. The law applies to all vehicle liability insurance policies issued, delivered or renewed in the state, starting Jan. 1, 2011.

The measure was approved by both houses of the Maryland General Assembly during the 2010 session.

In a statement to IFAwebnews.com, O’Malley’s office said the legislation adjusts insurance regulations that have “not been updated for several years, and follows a trend that many other states have also done.

“Ultimately, this national trend is designed to protect drivers who are involved in accidents and their families from the undue burden of exorbitant out-of-pocket expenses if the other driver is carrying insufficient insurance coverage,” O’Malley spokesman Shaun Adamec said.

The measure has come under fire by property-casualty insurers and trade groups, including the American Insurance Association.

The association, representing 300 insurers nationwide, told IFAwebnews.com, its stands by its opposition to the bill, which makes Maryland’s minimum liability coverage requirements among the nation’s highest.

“Forcing drivers, especially economically vulnerable ones, to purchase higher liability limits on their auto insurance policies during this tough economy is misguided,” said Tammy Velasquez, AIA vice president and director of state affairs, in a statement. “This legislation will lead to increased insurance costs and greater numbers of uninsured drivers.”

Velasquez added that Maryland’s current requirements “are working just fine,” despite O’Malley’s contention that they were ready for change.

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