Maryland: Auto Insurers Must Pay Diminished-Value Claims in Hit-and-Run Accidents

Mandatory uninsured motorist coverage should pay diminished-value claims, state’s insurance authority determines.

Sara Getman
Written bySara Getman
Sara Getman
Sara GetmanAssociate Editor

Sara Getman is an Associate Editor at Insurify and has been with the company since 2022. Prior to joining Insurify, Sara completed her undergraduate degree in English Literature at Simmons University in Boston. At Simmons, she was the Editor-in-Chief for Sidelines Magazine (a literary and art publication), and wrote creative non-fiction.

Outside of work, Sara is an avid reader, and loves rock climbing, yoga and crocheting.

Evelyn Pimplaskar
Evelyn PimplaskarEditor-in-Chief, Director of Content
  • 10+ years in insurance and personal finance content

  • 30+ years in media, PR, and content creation

Evelyn leads Insurify’s content team. She’s passionate about creating empowering content to help people transform their financial lives and make sound insurance-buying decisions.

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John Leach
Reviewed byJohn Leach
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John LeachSenior Insurance Copy Editor
  • Licensed property and casualty insurance agent

  • 8+ years editing experience

John leads Insurify’s copy desk, helping ensure the accuracy and readability of Insurify’s content. He’s a licensed agent specializing in home and car insurance topics.

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Published May 28, 2024 at 5:00 AM PDT | Reading time: 2 minutes

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Maryland drivers who get into accidents with uninsured drivers, or whose vehicles are damaged in a hit-and-run accident, can now recoup their repaired vehicle’s loss in value from their own insurance companies.

In April, the Maryland Insurance Administration notified insurers they must pay diminished-value claims through the state’s required uninsured/underinsured motorist coverage in cases where the at-fault driver lacks adequate insurance or is unknown.

Diminished value is the difference between how much a car is worth before and after an accident. Cars lose between 10% and 30% — or more — in value after an accident, even if they’ve been repaired with original manufacturer parts. That can add up to thousands of dollars lost when selling a used car. Now, drivers can recover some of the money.

How this protects insured drivers

Maryland is an at-fault state, so in an accident, the at-fault driver’s insurance pays out a diminished-value claim. But, if the at-fault driver is uninsured or unknown, the claim falls on the injured party’s insurance.

Approximately 14% of Maryland drivers are uninsured, according to the Insurance Research Council.

Previously, insurance companies could deny diminished-value claims for damages caused by an uninsured or unidentified driver. And some insurers worded their auto policies to exclude diminution-of-value claims from uninsured motorist coverage.

Now, uninsured motorist coverage includes diminished value under property damage, so insurers can’t deny a valid claim. And any insurers whose policies excluded diminished-value claims from uninsured motorist coverage must remove that language and refile their policies with the state’s insurance administration no later than July 11, 2024 — 90 days after the date of the administration’s notice to insurers.

What’s next? Submitting a claim

Cars lose anywhere from $500 to $2,100 on average after an accident.

Even if a vehicle is completely restored, the accident history will diminish the car’s value when trying to sell. A diminished-value claim can help mitigate that loss.

Often, insurers won’t suggest a diminished-value claim, so it’s up to the driver to collect the necessary information and submit a claim.

To submit a claim, drivers need to know the market value of their car and record the extent of the damage, the cost of repairs, and the mileage on the vehicle. After compiling the information, they should talk to an insurance agent to find out how much money they could receive. The payout will depend on the type of damage, whether it’s structural or cosmetic, and the extent.


Sara Getman
Sara GetmanAssociate Editor

Sara Getman is an Associate Editor at Insurify and has been with the company since 2022. Prior to joining Insurify, Sara completed her undergraduate degree in English Literature at Simmons University in Boston. At Simmons, she was the Editor-in-Chief for Sidelines Magazine (a literary and art publication), and wrote creative non-fiction.

Outside of work, Sara is an avid reader, and loves rock climbing, yoga and crocheting.

Evelyn Pimplaskar
Edited byEvelyn PimplaskarEditor-in-Chief, Director of Content
Evelyn Pimplaskar
Evelyn PimplaskarEditor-in-Chief, Director of Content
  • 10+ years in insurance and personal finance content

  • 30+ years in media, PR, and content creation

Evelyn leads Insurify’s content team. She’s passionate about creating empowering content to help people transform their financial lives and make sound insurance-buying decisions.

Featured in

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John Leach
Reviewed byJohn LeachSenior Insurance Copy Editor
Photo of an Insurify author
John LeachSenior Insurance Copy Editor
  • Licensed property and casualty insurance agent

  • 8+ years editing experience

John leads Insurify’s copy desk, helping ensure the accuracy and readability of Insurify’s content. He’s a licensed agent specializing in home and car insurance topics.

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