USA – MARYLAND Trends and Developments Contributed by: Bryan D. Bolton, James F. Taylor and Brett Baulsir, Funk & Bolton, P.A.
Funk & Bolton, P.A. Suite 1400 100 Light Street Baltimore Maryland 21202 USA Tel: 410-659-7700 Fax: 410-659-7773 Email: rtundermann@fblaw.com Web: www.fblaw.com
Maryland’s regulatory and administrative environ- ment makes insurance litigation in Maryland different from most states. This is in part because the Mary- land Insurance Commissioner (the “Insurance Com- missioner”) is charged with the authority and duty to enforce Maryland’s Insurance Article. The Insurance Commissioner’s authority extends to conducting examinations and investigations as necessary to fulfil this purpose. In addition to direct regulation by the Insurance Com- missioner, the Maryland General Assembly created a People’s Insurance Counsel Division (PICD) in the Office of the Attorney General. The PICD exists to pro - tect people insured under policies of medical profes- sional liability insurance and homeowner’s insurance issued or delivered in Maryland and is authorised to appear before the Insurance Commissioner on behalf of insurance consumers. The PICD is responsible for reviewing and evaluating each medical professional liability insurance and homeowner’s insurance mat- ter pending before the Insurance Commissioner to determine whether insurance consumers’ interests are affected and is required to review any rate increase of 10% or more by any medical professional liability insurer or homeowner’s insurer. Although the statutory language regarding the PICD’s authority is not entirely clear, the Supreme Court of Maryland has determined the PICD has standing to request a hearing before, and file a petition for judi - cial review from an adverse decision of, the Insur- ance Commissioner. The PICD’s opposition to a pro- fessional liability or homeowner’s filing can present additional challenges for insurers, but the Supreme
Court of Maryland has demonstrated a willingness to correctly apply the law and disregard misguided argu- ments from the PICD. The PICD’s authority to appear before the Insurance Commissioner is significant because the Maryland Insurance Administration (MIA), under the direction of the Insurance Commissioner, has an established pro- cess for administrative complaints alleging violations of the Maryland Insurance Article. The MIA investi- gates such complaints and initially determines wheth- er a violation of Maryland insurance law occurred. Anyone “aggrieved” by an investigative determina- tion may request a hearing, which is a quasi-judicial proceeding with limited discovery. A hearing request must set forth “[t]he action or non-action of the Com- missioner causing the person requesting the hearing to be aggrieved”, and “[t]he ultimate relief requested”. A defective hearing request could be denied, but the MIA rarely enforces this type of procedural deficiency, and it is often overlooked in consumers’ requests for hearings. The Insurance Article grants the Insurance Commis- sioner broad remedial powers for violations of the Insurance Article, including imposing fines for each violation that is arbitrary and capricious and for viola- tions committed with such frequency as to indicate a general business practice. A party dissatisfied with a final order of the Insurance Commissioner can seek judicial review in a Maryland circuit court. In 2026, the Maryland General Assembly enacted leg- islation granting authority to the “Administration”, as
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