New Legislation in Maryland and New York Could Transform Insurance Landscape

The insurance industry must closely monitor the significant legislative developments unfolding in Maryland and New York, which could profoundly impact liability claims and insurance costs. These regulatory changes underscore the evolving compliance requirements that insurers, providers, and carriers face, potentially affecting underwriting and claims processes.

In Maryland, a proposed bill aims to eliminate the cap on non-economic damages, such as "pain and suffering" awards in injury lawsuits. Currently, this cap is set at $965,000, with incremental increases of $15,000 annually. If passed, the legislation could lead to increased liability claims, escalating commercial truck insurance premiums by up to 30% and personal auto insurance costs by 19%. These developments are generating concern among industry stakeholders, such as the Owner-Operator Independent Drivers Association (OOIDA), who warn of potential lawsuits and large verdicts that could reshape the risk management landscape.

Conversely, New York's legislative proposal seeks to limit recoverable damages for specific drivers involved in accidents. This proposal, led by Senator Monica Martinez, would restrict uninsured, impaired, or felony-committing drivers to claims covering only tangible losses like property damage and medical expenses. This measure is designed to shield law-abiding drivers from subsidizing those disregarding legal standards and is currently under review in the Senate Transportation Committee. Both states' legislative efforts reflect an ongoing dialogue about liability limits, regulatory compliance, and their implications for insurance premiums and industry dynamics, making it crucial for insurers to stay informed and adaptive.