Maryland Total Loss Car Insurance Law: What COMAR 31.15.12 Requires

What is the total loss threshold in Maryland?

Maryland does not set one for your insurer. The rule that governs the claim decision is COMAR 31.15.12.02B(9), and it defines a total loss as a car whose repair cost equals or exceeds its actual cash value, or equals or exceeds "a percentage of the actual cash value of the motor vehicle established by the insurer." Established by the insurer. The State picks no number, and the same provision lets the insurer add estimated repairs from hidden damage and anticipated rental coverage on top of the repair estimate before it compares the two.

The 75 percent figure you have read about is real, but it belongs to the title. Under Md. Code, Transportation 11-152(a)(1), a vehicle is "salvage" when the cost to repair it for legal operation on a highway "exceeds 75% of the fair market value of the vehicle prior to sustaining the damage." Three things separate that from your claim. It measures against fair market value, not actual cash value. Its repair cost is calculated without towing, storage, rental, or cosmetic repair, because Transportation 13-506(c)(4) says a person may not use those costs. And Maryland says out loud that it does not drive the decision:

"The calculation under the 75% cost of repair threshold under paragraph (2) of this subsection may not affect the right of an insurer or a vehicle owner to make an economic or safety related decision to not repair the vehicle."

Md. Code, Transportation 13-506(c)(5)

Be fair to the number, though. The Maryland Insurance Administration's own consumer page describes 75 percent of pre-loss fair market value as the point where an insurer "is permitted to treat your vehicle as a total loss," so it is the benchmark Maryland carriers work to in practice. What it is not is a state command to total your car, a rule measured against actual cash value, or a statement about how big your check has to be. It brands the title. Your settlement runs on a different rule entirely, and that rule is unusually good. The rest of this page is about it.

The minimum offer Maryland requires

Maryland is not a quiet state. The legislature ordered a total-loss rule into existence: Insurance 27-304.1 says the Commissioner "shall adopt regulations that establish standards and procedures for" both the settlement of private passenger total-loss claims and "the determination of the private passenger motor vehicle's total loss value." The result is COMAR 31.15.12, and it sets a floor:

"If an insurer elects to make a cash settlement for the total loss of a motor vehicle pursuant to Regulation .03 of this chapter, the insurer's minimum offer, subject to applicable deductions, shall be: A. The total of: (1) The retail value for a substantially similar motor vehicle from a nationally recognized valuation manual or from a computerized data base that produces statistically valid fair market values for a substantially similar vehicle as defined in Regulation .02B(7) of this regulation; and (2) Regardless of whether the claimant retains salvage rights, the applicable taxes and transfer fees pursuant to COMAR 11.11.05."

COMAR 31.15.12.04

Read the word "retail." Maryland's floor is the retail value for a substantially similar car, not a wholesale figure, not trade-in, not some averaged market number. The MIA says the same thing in plain English on its consumer page: the offer is the actual cash value "based on the current retail value of your vehicle." If your report arrives at a number that no one in Maryland could actually buy that car for at retail, you have a floor to point at.

The rule gives the insurer a second route in subsection B, a quotation for a substantially similar vehicle from a qualified dealer at a location reasonably convenient to you, with the same taxes and fees added. Most carriers use the database route.

What counts as a comparable car

This is where Maryland reports come apart, because the definition is strict and it is written entirely in your favor:

"'Substantially similar motor vehicle' means a motor vehicle that, in comparison to a damaged motor vehicle: (a) Is the same make and model as the damaged motor vehicle; (b) Is the same year as, or a more recent year than, the damaged motor vehicle; (c) Contains at least the same major options as the damaged motor vehicle; (d) Is in a condition substantially similar to or better than the condition of the damaged motor vehicle immediately before the damage occurred; and (e) Has mileage that is within the greater of 4,000 miles or 10 percent of the mileage on the damaged motor vehicle at the time that the damage occurred unless the vehicle is limited in production, specialty in nature, or older than 10 model years at the time of total loss."

COMAR 31.15.12.02B(7)

Every clause is a floor, not a target. Same year or newer. At least the same major options. Condition substantially similar or better. The mileage band is the greater of 4,000 miles or 10 percent, whichever gives you more room. A comparable that is a year older, less equipped, or in rougher shape than your car was is not substantially similar under this definition, and Regulation .04 requires the value to be for a vehicle that meets it.

So go through the comparables list with the definition beside it. Older model year, missing options, a condition grade below yours, mileage outside the band: each one is a specific, checkable defect in the number, not a matter of opinion. The exception at the end lifts the mileage band alone, and only for limited-production, specialty, or over-ten-model-year vehicles. It does not relax the make, model, year, options, or condition requirements.

One honest gap. Maryland has no local market area concept and no mile radius anywhere in this chapter, and no rule about how recently a comparable was listed or sold. If a Maryland site tells you the comps have to be within some distance or some number of days, it is making that up. Argue the definition you actually have, which is a strong one.

The five documents you can demand

Maryland requires the offer itself to tell you that these documents exist, and then requires the insurer to produce them when you ask:

"A settlement offer made by an insurer pursuant to Regulation .04 of this chapter shall: (1) State the amount being offered; (2) Inform the claimant that, on request from the claimant, the insurer shall provide the claimant in writing: (a) A copy of the settlement offer; (b) The method used to arrive at the value of the motor vehicle, including identification of any books, manuals, or databases used; (c) A detailed explanation of the insurer's calculation of the motor vehicle's total loss value, including the calculation of any value added to the motor vehicle by options; (d) A list of all deductions that will be made from the value of the motor vehicle; and (e) A copy of the inspection guidelines relied on by the insurer to determine the condition of the vehicle at the time of the loss."

COMAR 31.15.12.05A

Subsection (e) is the one most people never ask for, and it is the best single request in Maryland. If your report knocked money off for condition, the insurer used some guideline document to decide your car was worth less. Ask for it. Then compare what it says against what the adjuster actually saw and recorded about your car. A condition deduction that cannot be traced back to the guideline it supposedly came from is an argument you can make in one paragraph.

Subsection (c) is close behind, because it reaches options by name. If your car had a package the comparables did not, the detailed explanation has to show the calculation of the value added by those options. Subsection (d) forces the list of every deduction, which is how you find the ones the summary page never named.

The insurer has 7 business days to respond to the request under Regulation .05B. Make the request in writing and date it.

There is a second point hiding in this rule. Regulation .05A(2) and .05A(3) are duties owed at the moment of the offer: the offer must tell you that you can request these documents, and must tell you that you can reject and counteroffer. If the letter that carried your number did neither, that is a defect in the offer itself, separate from anything in the valuation.

Maryland regulates your counteroffer

This is the part of Maryland law that almost nobody writes about, and it is the reason a documented Maryland dispute is worth making. Most states leave you to argue in the dark. Maryland wrote your side of the exchange into the rule:

"After receipt of a settlement offer, a claimant may: (1) Accept the offer; or (2) In writing, reject the offer and make a counteroffer based on: (a) Dealer quotations for a substantially similar motor vehicle; (b) Advertisements for a substantially similar motor vehicle; or (c) Any other source of valuation for a substantially similar motor vehicle."

COMAR 31.15.12.06A

Note (c). Any other source of valuation. You are not confined to dealer quotes and classified ads. Current retail listings for cars that meet the substantially-similar definition qualify, and so does a corrected calculation built from the insurer's own report.

Then comes the obligation that gives the counteroffer teeth. Under Regulation .06B, if the insurer rejects your counteroffer, it has 5 business days to send you a written explanation, in clear and understandable language, of why the information you relied on does not provide a more accurate valuation than the information it relied on in its offer.

Sit with what that requires. The adjuster cannot answer a documented counteroffer with silence or with "our valuation stands." Maryland makes them explain, in writing, on a clock, why your evidence is worse than theirs. If your counteroffer is three current retail listings for cars that match the definition and a corrected line-by-line rebuild of their own math, that written explanation is a hard letter to write.

Two limits, stated plainly. The duty attaches only if the insurer rejects the counteroffer, and the duty is to explain, not to pay. Nothing here guarantees a different number.

Deadlines that bind the insurer

• 10 business days after the insurer determines your car is a total loss to make a cash offer, or to replace the vehicle if your policy authorizes that (COMAR 31.15.12.03B). The clock runs from the insurer's own total-loss determination, not from the accident.
• The later of 30 days after notice of claim or the policy period for an unrecovered theft loss (31.15.12.03C).
• 7 business days to respond to your request for the valuation documents (31.15.12.05B).
• 5 business days to explain in writing why your counteroffer is less accurate, if the insurer rejects it (31.15.12.06B).
• 15 working days to pay amounts properly due after a properly completed claim form or proof of loss, where there is no significant dispute as to coverage, liability, and amount. Failing that is the definition of "unreasonable delay" in COMAR 31.15.07.02B(12).
• Every 45 days, written notice of the actual reason more time is needed, if the investigation is not complete (COMAR 31.15.07.04B).

One caveat on the 10 days that honest reading requires. Regulation .03A suspends those deadlines where there is a good faith dispute as to the insurer's obligation under the contract, or where factors beyond the insurer's control get in the way, including limited-production, specialty, and over-ten-model-year vehicles.

Sales tax and transfer fees

Maryland requires them, and the wording closes the loophole most states leave open. Regulation .04 puts "the applicable taxes and transfer fees pursuant to COMAR 11.11.05" into the minimum offer under both the database route and the dealer-quote route, and both times it says "Regardless of whether the claimant retains salvage rights."

That last phrase matters. If you kept the car, the insurer subtracts salvage value from your settlement, but it cannot use your decision to keep the car as a reason to drop the taxes and transfer fees. The MIA states the same rule for consumers: the settlement offer "will also include applicable tax and registration fees."

Check your settlement breakdown for these as separate line items. On a $20,000 car in Maryland they are real money, and they are among the most commonly omitted numbers on a total-loss statement.

The good-faith remedy and its prerequisites

Maryland gives first-party policyholders something most states do not, and it reaches car claims. The chain takes three statutes to see, which is why it gets missed. Courts and Judicial Proceedings 3-1701 applies "only to first-party claims under property and casualty insurance policies or individual disability insurance policies issued, sold, or delivered in the State." Insurance 1-101(i)(2) then provides that "Casualty insurance" includes motor vehicle physical damage insurance. So a first-party collision or comprehensive total loss is inside it.

The standard is defined:

"'Good faith' means an informed judgment based on honesty and diligence supported by evidence the insurer knew or should have known at the time the insurer made a decision on a claim."

Md. Code, Courts and Judicial Proceedings 3-1701(a)(5); Md. Code, Insurance 27-1001(a)

Where an insurer is found to have failed to act in good faith, 3-1701(e) allows recovery of actual damages up to policy limits, expenses and litigation costs including reasonable attorney's fees, and interest on all of it. Attorney's fees are capped at one third of actual damages. Separately, Insurance 27-303(18) makes failing to act in good faith on a first-party property and casualty claim an unfair claim settlement practice in its own right, and Insurance 27-305 lets the Commissioner impose penalties and order restitution for actual economic damage.

Now the prerequisites, because they are strict and knowing them is the point. Under Insurance 27-1001, a complaint stating this cause of action must first be filed with the Maryland Insurance Administration before any court action, with every proof-of-loss document attached, the coverage and claim amount specified, and the damages stated. There are only three exceptions: District Court small claims, a waiver both sides agree to, and commercial policies with limits above $1,000,000. The insurer then has 30 days to file a response with the claim-file documents that allow the MIA to reconstruct what it did, and to mail you a copy. The MIA has 90 days to decide, and if it does not decide in time, that counts as a determination that the insurer did not breach.

And the honest limit, which cuts against the impatient reading:

"An insurer may not be found to have failed to act in good faith under this section solely on the basis of delay in determining coverage or the extent of payment to which the insured is entitled if the insurer acted within the time period specified by statute or regulation for investigation of a claim by an insurer."

Md. Code, Courts and Judicial Proceedings 3-1701(f)

Slow is not the same as bad faith when the insurer stayed inside the clocks. This section is here so you know what Maryland law provides and what it requires, not as something to wave at an adjuster. A low first offer is an ordinary event in a claim, and the way to move it is documentation.

What to do if your offer looks low

1. Request the five documents in writing. COMAR 31.15.12.05A(2) entitles you to the method and the databases used, the detailed calculation including the value added by options, the list of all deductions, and the inspection guidelines relied on for condition. Date the request. The insurer has 7 business days.
2. Test every comparable against the definition. Same make and model, same year or newer, at least the same major options, condition substantially similar or better, mileage within the greater of 4,000 miles or 10 percent. Mark each failure.
3. Check the deductions against the guidelines. A condition adjustment that the inspection guidelines do not account for, applied flat across every comparable, is the most common defect in these reports and the easiest to describe.
4. Confirm the taxes and transfer fees are there as separate line items, whether or not you kept the car.
5. Rebuild the number. Correct each flawed adjustment using the report's own figures and current retail listings for cars that meet the substantially-similar definition. That corrected math is your supported figure.
6. Send a written counteroffer under COMAR 31.15.12.06A(2). Reject the offer in writing, state your figure, and attach your sources. If the insurer rejects it, Regulation .06B gives it 5 business days to explain in writing why your information is less accurate than its own.
7. Escalate if the file stalls. The Maryland Insurance Administration takes complaints through its consumer complaint page, including an online portal that accepts attachments. Name the specific regulations and the dates.

TrueTotal handles the middle of that list for you. Upload the insurer's total-loss PDF and the free gap-check reads the report, flags the adjustments and comparables that do not hold up, and shows the estimated dollar gap before you pay anything. The $49 package adds a plain-English breakdown of every flaw and a counteroffer letter built from the report's own math and the Maryland rules on this page, with current comparable listings and every source linked. You review it and you send it. TrueTotal is a self-help tool. It is not a law firm, it does not appraise anything, it never contacts or negotiates with your insurer, and its math supports a corrected figure rather than promising any particular recovery.