Delayed “UIM Claims”: “Limitations”, “Laches”, and “Estoppel”
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The general concept
A person injured by an underinsured driver may seek benefits under the injured person’s own automobile policy after pursuing the at-fault driver’s available liability insurance. The UIM claim is a separate contractual claim against the UIM insurer. A long gap between the crash, the demand for UIM benefits, and a lawsuit can raise different timing defenses, and those dates should not be treated as interchangeable.
How Maryland applies it
Maryland generally gives three years to file a civil action after it accrues. A UIM benefits action against the injured person’s own insurer is a contract action. The Supreme Court of Maryland held that the limitations period begins when the insurer denies the insured’s demand for UIM benefits, which is the alleged breach of the policy. The clock does not ordinarily start merely because the crash occurred, the other driver’s limits were paid, or the insured made the UIM demand. The Court reaffirmed that contract-based accrual rule in 2025.
A carrier’s review of a demand, acknowledgment of receipt, or request for supporting records does not necessarily amount to a denial. The court in Shilling treated those steps as insufficient, on the record before it, to show a breach. The words used, the full course of communications, and whether the carrier has clearly refused benefits can matter. Once the insurer denies the claim or otherwise clearly refuses payment, the insured should treat the three-year filing period as running and promptly evaluate suit; ongoing negotiations do not automatically stop that period.
When a policy contains no express deadline for making the initial UIM demand, a very late demand still may face a laches defense. Shilling recognized laches as a possible protection against unreasonable delay in asserting a UIM claim. Laches is not a second three-year statute measured from the accident. It generally requires an unreasonable or inexcusable delay and prejudice to the opposing party. The length of delay matters, but delay alone is not automatically enough; the court examines what was lost or impaired because the claim was not pursued sooner.
Other defenses depend on the policy and the steps taken. A policy may require notice, cooperation, or proof of claim. Maryland’s actual-prejudice rule under Insurance Article § 19-110 is limited to disclaimers based on lack of required notice or failure to cooperate; it does not excuse failure to follow the separate UIM settlement procedure in § 19-511. A UIM insurer can waive a § 19-511 requirement, but waiver turns on the insurer’s conduct and intent. Waiver and estoppel are fact-specific: continued claim handling or settlement discussions alone do not guarantee that a deadline is suspended. Written tolling agreements and prompt follow-up reduce uncertainty.
Related Maryland Cases and Authorities
Md. Code, Cts. & Jud. Proc. § 5-101; Md. Code, Ins. §§ 19-110, 19-511; Nationwide Mut. Ins. Co. v. Shilling, 468 Md. 239, 226 A.3d 492 (2020); Bowens v. State Farm Mut. Auto. Ins. Co., No. 10, Sept. Term, 2025, slip op. at 19–20 (Md. Nov. 24, 2025); Ademiluyi v. Egbuonu, 466 Md. 80, 215 A.3d 785 (2019); Woznicki v. GEICO Gen. Ins. Co., 443 Md. 93, 115 A.3d 152 (2015).