Not legal advice. We paraphrased these Maryland provisions from the General Assembly's free statute text and the state's official online library of regulations (COMAR).
What is different in Maryland
Three features stand out. A death benefit in Maryland earns interest from the date of death unless the company pays within 30 days, and the same rule is written separately for group policies. Maryland’s claims regulation has a chapter just for life, health and annuity insurers with fixed day counts. And Maryland voids any policy clause that cuts the time to sue below what state law allows.
Contest period
An individual life policy must state that, apart from nonpayment of premium, it cannot be contested once it has been in force for two years after its date of issue during the insured’s lifetime. That rule does not cover disability or accidental-death riders (Md. Code, Ins. 16-203(a), (b)). The statute also spells out that the contest clause bars only challenges to the validity of the policy. It does not stop the insurer from relying on policy terms that exclude or restrict coverage (16-203(c)). A reinstated policy can be contested for fraud or material misrepresentation in the reinstatement only for the same period and on the same terms as the original contest clause (16-107(a)).
Suicide and other exclusions
A life policy may exclude death by suicide, sane or insane, only within two years after issue, along with a short list of other permitted exclusions (war and military service, aviation, and for the first two years a hazardous occupation or residence outside the continental United States and Canada). A policy may not exclude death from a terrorist act the insured did not commit or take part in. Where an exclusion applies, the insurer must still pay at least a reserve-based amount (16-215(b)). For a replacement policy, the two-year suicide period generally runs from when the insurer first insured the person, with exceptions for coverage above the old amount and for some gaps between policies (16-215(e)).
Application misstatements
Anything said in an application for issuing, renewing or reinstating a life policy is a representation, not a warranty. A false or incomplete answer defeats recovery only if it was fraudulent or material to the risk or hazard, or if the insurer, knowing the truth, would in good faith have refused the policy, charged more or issued less, or not covered the hazard that caused the death (Ins. 12-207). If the application is made part of the policy, its statements are treated as representations absent fraud, and the policy plus an attached copy of the application are the entire contract (16-204).
A misstated age changes the benefit to what the premium would have bought at the true age. If the true age was outside the insurer’s age limits, the insurer may void the policy only during the insured’s life, no later than three years after issue and within 30 days of learning the correct age, and must refund premiums less dividends and loans (16-205).
Grace period and lapse
Every premium after the first gets a grace period of 30 days, or at the insurer’s option one month of at least 30 days, with four weeks for certain industrial policies. Coverage continues during that time, and an unpaid premium may be subtracted from a claim that arises in it (16-202). An ordinary lapsed policy can be reinstated within three years of the first missed premium (two years for industrial policies) with a written application, satisfactory evidence of insurability and payment of arrears and loans with interest of no more than 6% a year, unless it was surrendered, its cash value was used up by loans, or paid-up term coverage expired (16-210).
For a universal or variable life policy that lets the owner lower the face amount, the insurer must send a written notice explaining that option, the amount needed to prevent lapse and its customer service number, both at the start of the grace period and at least 30 days before coverage ends (16-219).
Interest from the date of death
Under an individual policy issued in Maryland, interest on the benefit accrues from the insured’s date of death until the proceeds are paid. Two exceptions apply: no interest is owed if the insurer pays within 30 days after the death, and if proof of death is submitted more than 180 days after the death, interest runs only from the date the proof was submitted. The rate may not be lower than what the company pays on death proceeds left on deposit with it (Ins. 16-109). Maryland repeats the same rule, in near-identical words, for group life policies (17-102).
The policy itself must say that the claim will be settled on proof of death (and, if the insurer asks, surrender of the policy and proof of the claimant’s interest), and that the benefit includes a refund of any premium paid for months after the month of death (16-211).
Claim handling deadlines
Maryland’s regulation for life, health and annuity claims, COMAR 31.15.08, applies to individual and group policies and certificates. Treated as unfair when done often enough to show a general business practice, it includes:
- not giving the claimant needed claim forms, instructions and reasonable help within 10 working days of notification of a claim (.03B(15)); doing so also counts as acknowledging the claim (.03C);
- not acting within 30 days after receiving a claim with all necessary information, by paying it, refusing it with specific reasons, or explaining why it could not be processed and naming the additional information needed (.03B(12));
- requiring a formal claims report when a preliminary report already gave all the necessary information (.03B(11)).
Days between the insurer mailing a request for more information and receiving the answer do not count (.04). Some acts are violations even if done once, including concealing pertinent benefits, refusing a claim for an arbitrary or capricious reason, and not explaining a denial on request (.03A).
The Insurance Article lists parallel unfair claim settlement practices (Ins. 27-303 for single acts, 27-304 for general business practices). That subtitle gives administrative remedies only: it neither creates nor bars a private lawsuit, and it leaves other claims available (27-301(b)). The Commissioner may impose penalties and order restitution of actual economic loss or payment of a claim found to have been wrongly denied (27-305).
Bad faith
Maryland’s statutory first-party bad-faith action, with recovery of expenses, attorney fees capped at one third of actual damages, and interest, applies only to property and casualty and individual disability policies (Cts. & Jud. Proc. 3-1701(b)). It does not cover life insurance. In Johnson v. Federal Kemper Insurance Co., 74 Md. App. 243, 536 A.2d 1211 (1988), the Court of Special Appeals (now the Appellate Court of Maryland) held that Maryland does not recognize a tort action against an insurer for bad-faith failure to pay an insurance claim, and that punitive damages are not available in an action for breach of contract alone. That decision came before 3-1701 was enacted, and 3-1701 does not reach life policies.
Group life insurance
Group policies have their own required provisions (Ins. 17-301 to 17-311):
- a 31-day grace period, with death coverage continuing unless the policyholder gave written notice of discontinuance (17-302);
- a two-year contest period, and a bar on using an insured’s statement about insurability after two years of coverage during the insured’s lifetime, or at all unless it is written and signed by the insured (17-303); a copy of the statement must have gone to the insured or, after death, to the beneficiary (17-304);
- a right to convert to an individual policy without evidence of insurability within 31 days after employment or membership ends, with written notice of that right at least 15 days before the window closes; if the notice is late, the insured gets 15 more days after receiving it, up to 60 extra days (17-309);
- if the insured dies during the conversion window, the amount that could have been converted is payable under the group policy, whether or not an application was made (17-311).
Coverage through a private employer is generally also an ERISA plan, which brings federal appeal steps and remedies; see employer group life.
Deadline to sue
A civil action at law in Maryland must generally be filed within three years of when it accrues, unless another statute sets a different period (Cts. & Jud. Proc. 5-101). On policy deadlines, a clause in an insurance contract that sets a shorter time to sue than state law requires when the policy is issued or delivered is against public policy and void, and an insurer may not base a defense on it (Ins. 12-104).
When the beneficiary caused the death
Maryland’s slayer statute disqualifies anyone who feloniously and intentionally kills, conspires to kill, or procures the killing of the decedent. A disqualified person is treated as having disclaimed, and a disqualified person who is the named beneficiary of a life policy is not entitled to the benefit (Est. & Trusts 11-112(a), (b), (d)).
- Proof. A final conviction is conclusive. Without one, a civil court may decide by a preponderance of the evidence, and a party may ask to pause the civil case until a pending criminal case ends (11-112(e)(2), (j)).
- Time limit. A civil claim that someone is disqualified must be filed within three years of the death or, if the person is criminally charged within those three years, within one year of the charge, whichever is later (11-112(e)(1)).
- Insurer protection. An insurer that pays under the policy is not liable unless it received written notice of the alleged disqualification at its home office or principal address before paying. Only someone who would take if the beneficiary were disqualified, or that person’s representative, may send that notice, and only within the same time limit. An insurer that deposits the money with a court in a court deposit action is not liable to the alleged killer for doing so (11-112(e)(3), (f)).
- A named beneficiary may also ask a court to declare that they are not disqualified (11-112(i)).
Worked example
An insured dies on March 2, 2026. The beneficiary reports the claim on March 9, so the insurer should send forms and instructions by March 23, 10 working days later. The completed claim with the death certificate arrives March 20. If the insurer has neither paid, denied with reasons, nor explained what it still needs by April 19, 30 days later, that is a failure under COMAR 31.15.08.03B(12). Because payment did not come within 30 days of the death, interest on the benefit runs from March 2 until the day it is paid, at no less than the insurer’s own rate on proceeds left on deposit.
Making a complaint
The Maryland Insurance Administration takes complaints about insurers, including life insurers: File a Complaint (Maryland Insurance Administration). A complaint does not pause the time limit for a lawsuit.
Sources
- Annotated Code of Maryland, Insurance Article 12-104, 12-207, 16-101, 16-107, 16-109, 16-201 to 16-205, 16-210, 16-211, 16-215, 16-219, 17-102, 17-301 to 17-311 and 27-301 to 27-305; Courts and Judicial Proceedings Article 3-1701 and 5-101; Estates and Trusts Article 11-112, from the General Assembly’s statute pages: mgaleg.maryland.gov.
- COMAR 31.15.08.01 to .07, Payment of Claims Under Life and Health Policies and Annuity Contracts: regs.maryland.gov.
- Maryland Insurance Administration, File a Complaint: insurance.maryland.gov.
- Johnson v. Federal Kemper Ins. Co., 74 Md. App. 243, 536 A.2d 1211 (1988) (full opinion, CourtListener): courtlistener.com. Read November 3, 2026.
Not legal advice. This page summarizes general rules and the specific statutes cited. Your policy's wording, the state whose law applies, and whether the coverage came through an employer can all change the result. See the disclaimer and editorial policy.