Underinsured motorist coverage covers any damage that you could have recovered from the defendant if the defendant had insurance. Your insurance company puts itself in the skin of the defendant and pays what the defendant would have been obliged to pay, up to the limits of your insurance policy. Coverage for uninsured or underinsured drivers leaves money available for compensation for their car accident claim when a driver is uninsured or doesn't have enough insurance coverage to pay for medical bills, lost wages, and pain and suffering. The underlying premise of insurance coverage for uninsured drivers in Maryland, as in most states, is to put the victim of an auto accident in the same situation that they would be in if the at-fault driver had liability coverage equal to the coverage of the accident victim.
Therefore, in underinsurance cases in Maryland, the at-fault driver does not have enough liability insurance to cover the loss of the accident victim. The victim's insurance can step in to close the gap between the at-fault driver's coverage and that of the victim. An insurance company's failure to pay the money that is “fair” to settle an uninsured motorist's claim constitutes a breach of contract with its insured.