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§ 11-318. Rate making principles

West's Annotated Code of MarylandInsuranceEffective: October 1, 2020

West's Annotated Code of Maryland
Insurance (Refs & Annos)
Title 11. Insurance Rating Law
Subtitle 3. Competitive Rating (Refs & Annos)
Part III. Same--Automobile Insurance Generally
Effective: October 1, 2020
MD Code, Insurance, § 11-318
§ 11-318. Rate making principles
Currentness
In general
(a) All automobile insurance rates shall be made in accordance with the principles set forth in this section.
Higher premiums due to specific claims or insured’s driving record
(b)(1) An insurer under an automobile liability insurance policy may not classify or maintain an insured for a period longer than 3 years in a classification that entails a higher premium:
(i) because of a specific claim; or
(ii) because of the insured's driving record.
(2) For the purpose of determining whether to classify an insured in a classification that entails a higher premium, an insurer may review only a period not greater than 3 years before:
(i) if the policy has not yet been issued:
1. the date of the application; or
2. the proposed effective date of the policy; or
(ii) on renewal of a policy, the effective date of the renewal.
(3)(i) The removal of a discount is not a violation of this subsection.
(ii) The application of a program that measures the operation of an insured vehicle during the current policy period is not a violation of this subsection.
(iii) Subparagraph (i) of this paragraph may not be construed to prevent an insurer from granting a claim-free discount to an insured.
Provisional driver’s license requirement for drivers under 18 years of age
(c) An insurer's automobile and physical damage insurance premiums shall reflect the reduction in claims, if any, attributable to the requirement that drivers under the age of 18 years must acquire a provisional driver's license before acquiring a driver's license.
Consideration of accident reports and court convictions relating to driving emergency vehicles
(d) For purposes of reclassifying an insured in a classification that entails a higher premium, an insurer under an automobile insurance policy may not consider accident reports and abstracts of court convictions that relate to driving an emergency vehicle and that are on record with the Motor Vehicle Administration, as provided in § 16-117(b) of the Transportation Article.
Consideration of probation before disposition of motor vehicle law offenses, civil penalties, or first offense of driving with alcohol concentration 0.08 or more
(e) For purposes of reclassifying an insured in a classification that entails a higher premium, an insurer under an automobile insurance policy may not consider a probation before judgment disposition of a motor vehicle law offense, a civil penalty imposed pursuant to § 21-202.1, § 21-809, § 21-810, or § 24-111.3 of the Transportation Article, or a first offense of driving with an alcohol concentration of 0.08 or more under § 16-205.1 of the Transportation Article on record with the Motor Vehicle Administration, as provided in § 16-117(b) of the Transportation Article.
Adjustment to premium based on change in circumstances
(f) If the insured under an automobile insurance policy notifies the insurer of a change in circumstances that justifies reclassifying the insured in a different classification or territory, the insurer shall adjust the premium charged the insured from the date of notification.
Reduction in rates based on actuarial justification
(g) For motor vehicle personal injury and property damage coverage, an insurer may provide a reduction in rates based on actuarial justification to an insured who:
(1) is at least 55 years old; and
(2) within the last 2 years, has completed successfully a course in accident prevention:
(i) that is approved by the Motor Vehicle Administration;
(ii) that includes classroom instruction or practice driving of the number of hours that the Motor Vehicle Administration requires; and
(iii) for which the insured has received a certificate that certifies the completion of the course.

Credits

Added by Acts 1997, c. 35, § 2, eff. Oct. 1, 1997. Amended by Acts 1997, c. 315, § 1, eff. Oct. 1, 1997; Acts 2003, c. 21, § 1, eff. April 8, 2003; Acts 2006, c. 15, § 1, eff. Feb. 24, 2006; Acts 2009, c. 378, § 1, eff. Jan. 1, 2010; Acts 2009, c. 500, § 2, eff. Oct. 1, 2009; Acts 2012, c. 375, § 1, eff. Oct. 1, 2012; Acts 2012, c. 376, § 1, eff. Oct. 1, 2012; Acts 2020, c. 144, § 1, eff. Oct. 1, 2020; Acts 2020, c. 145, § 1, eff. Oct. 1, 2020.
Formerly Art. 48A, § 244D.
MD Code, Insurance, § 11-318, MD INSURANCE § 11-318
Current through legislation effective through April 25, 2024, from the 2024 Regular Session of the General Assembly. Some statute sections may be more current, see credits for details.
End of Document