Shilling v. Nationwide 2019 Uninsured Motorist Case

When does the statute of limitations in Maryland begin to run on an uninsured or underinsured motorist claim? Maryland's intermediate appellate court got a chance to address this issue in a June 2019 opinion.

In Shilling v. Nationwide, the Maryland Court of Special Appeals considered the question of exactly when the statute of limitations begins to run on a claim for uninsured motorist damages after the UIM insurer accepts a policy limit settlement with the tortfeasor. The court was asked to decide whether the limitations period on a UIM claim begins: (1) when the UIM insurer waives subrogation and agrees to a policy limit settlement offer from the at-fault driver; or (2) when the plaintiff actually signs the release and finalizes the policy limits settlement offer from the at-fault driver. The COSA ultimately held that a UIM claim does not "accrue" until the plaintiff actually accepts the policy limit settlement offer from the at-fault driver and signs the release. This is necessary to protect the plaintiff's statutory right to choose between bringing a UIM claim or tort claim against the at-fault driver first.

Facts of Case

Plaintiff was injured in an auto accident. The other driver was clearly at-fault for the accident, but the limits on his auto insurance were only $20,000. Plaintiff had significant injuries and her damages were clearly going to exceed $20,000. The at-fault driver's insurance company quickly offered Plaintiff a policy limits settlement of $20k.

Under Maryland law, claimants in Plaintiff's situation are obligated to notify their own insurance company and get them to approve policy limit settlement offers. If claimants do not notify their insurance carrier and get approval of such settlements, they waive any right to pursue their insurer for additional uninsured or underinsured motorist (UIM) damages. So if claimants want to collect a policy limit settlement from the other driver AND then more damages from their UIM carrier, they need to get prior approval.

CrashPlaintiff and her lawyers were planning to pursue a UIM claim from the start, so they fully complied with the notice and approval requirements. Plaintiff promptly notified her own insurance company (Nationwide) about the policy limit settlement offer. In April 2013 Nationwide formally waived its subrogation rights and agreed to the policy limit settlement offer. At this point, Plaintiff had obtained the necessary approval and was free and clear to immediately accept and finalize the policy limit settlement offer. But Plaintiff did not immediately finalize the policy limits settlement. Instead, Plaintiff and her lawyers delayed for over 10 months before signing the release to finalize the $20k settlement in February 2014.

After finalizing the policy limits settlement in February 2014, Plaintiff and her attorneys allowed another 3 years to elapse while they sought to negotiate her UIM claim with Nationwide. When the UIM negotiations with Nationwide ultimately failed, Plaintiff finally filed suit against Nationwide in September 2016. Nationwide moved to dismiss on the grounds that Plaintiff's claim was barred by the statute of limitations. Nationwide argued that Plaintiff's 3 year limitation period began to run when Nationwide first approved the policy limit settlement offer in April 2013. The trial court (a very good judge, by the way) agreed and granted Nationwide's motion to dismiss.

Analysis on Appeal

Plaintiff promptly appealed the lower's court's dismissal of the case based on the statute of limitations. Plaintiff argued that the statute of limitations on her UIM claim did not begin to run when she initially got Nationwide's approval of the policy limits settlement offer in April 2013. Instead, Plaintiff claimed that her limitations period did not begin until 10 months later when she actually signed the release and accepted the policy limit settlement offer.

Nationwide continued to insist that the 3 year limitation period started in April 2013 when they approved the settlement proposal. Nationwide made a well-articulated argument that claimants such as Plaintiff should be allowed to add a year to their limitations deadline by delaying in signing the settlement release.

The COSA began its analysis of this issue with a discussion of Maryland uninsured/underinsured motorist law. Specifically, the Court noted the underlying intent of Maryland's UIM law is to provide protection for people injured by uninsured motorists. Schilling at 6. The Court also explained that the UIM statute is "liberally construed to ensure that innocent victims … can be compensated for the injuries they suffer[.] Id. (quoting Woznicki v. GEICO, 443 Md. 93, 110 (2015)).

The Court then went on to discuss 2 prior Maryland cases that offered guidance on the issue presented: Lane v. Nationwide, 321 Md. 165 (1990) and Pfeifer v. Phoenix Ins. Co., 189 Md. App. 675 (2010). In Lane, the Court of Appeals specifically rejected a similar argument that the limitations period on a UIM claim began to run when the plaintiff first learned that the at-fault driver was uninsured. Similarly in Pfeifer, the Court of Special Appeals refused to find that the limitations period on a UIM claim began from the date of the accident.


Following the reasoning in Lane and Pfeifer, the Court ultimately rejected the view that Plaintiff's limitation period on her UIM claim began to run when Nationwide first approved the settlement proposal back in April 2013. Instead, the Court held that the limitations period did not begin to run until 10 months later when Plaintiff formally accepted the polic limits offer (with Nationwide's permission) and signed the release agreement. According to the Court, this rule is necessary in order to protect the statutory right of claimants like Plaintiff to initially sue the tortfeasor and thereafter sue the UIM carrier.


Plaintiff's lawyers probably breathed a huge sigh of relief when opinion in this case was issued. The only reason this issue came up on appeal is because the plaintiff and her attorneys inexplicably dragged their feet for 10 months before finalizing the policy limits offer and another 2 years before filing their UIM claim against Nationwide. There is no meaningful discussion in the case explaining why this delay occurred, but it seems safe to assume that is was unintentional. Plaintiff's counsel did not gain any strategic or tactical advantage by this delay, and they very nearly lost their client's more valuable claim.

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