Title 27. Unfair Trade Practices and Other Prohibited Practices — Subtitle 4. Fraudulent Insurance Acts
Statutes in effect as of October 1, 2026.
Md. Code Ann., Ins. § 27-401 (2026)
Title 27. Unfair Trade Practices and Other Prohibited Practices
Subtitle 4. Fraudulent Insurance Acts
§ 27–401LinkCopy Citation
(a)
In this subtitle the following words have the meanings indicated.
(b)
(1)
“Claim” means a demand for payment or benefit under a policy or contract by an insured, third party, or representative of the insured or third party.
(2)
“Claim” includes a demand for payment or benefit made against:
(i)
the State under Title 12 of the State Government Article, Title 2, Subtitle 5 of the State Personnel and Pensions Article, or Title 9 of the Labor and Employment Article; or
(ii)
the Maryland Transit Administration when acting as a self–insurer under § 7–703 of the Transportation Article.
(c)
“Motor vehicle accident” means an occurrence involving a motor vehicle that results in damage to property or injury to a person.
Md. Code Ann., Ins. § 27-402 (2026)
Title 27. Unfair Trade Practices and Other Prohibited Practices
Subtitle 4. Fraudulent Insurance Acts
§ 27–402LinkCopy Citation
The provisions of this subtitle that apply to insurers also apply to:
(1)
a corporation that operates a nonprofit health service plan under Title 14, Subtitle 2 of this article;
(2)
a dental plan organization as defined in § 14–401 of this article;
(3)
a health maintenance organization as defined in Title 19, Subtitle 7 of the Health – General Article;
(4)
a surplus lines insurer;
(5)
the Maryland Automobile Insurance Fund;
(6)
the State when a claim has been filed against the State under Title 12 of the State Government Article;
(7)
the State when a claim has been filed against the State under Title 2, Subtitle 5 of the State Personnel and Pensions Article;
(8)
the State, including the Uninsured Employers’ Fund, when a claim has been filed against the State under Title 9 of the Labor and Employment Article;
(9)
the Maryland Transit Administration when acting as a self–insurer under § 7–703 of the Transportation Article;
(10)
a third party administrator under Title 8, Subtitle 3 of this article;
(11)
a self–insurer under § 17–103(a)(2) of the Transportation Article;
(12)
the Maryland Health Insurance Plan;
(13)
a governmental self–insurer group formed in accordance with § 9–404 of the Labor and Employment Article;
(14)
an employer who self–insures or participates in a self–insurance group in accordance with § 9–405 of the Labor and Employment Article; and
(15)
an agent, employee, or representative of an entity described in items (1) through (14) of this section.
Md. Code Ann., Ins. § 27-403 (2026)
Title 27. Unfair Trade Practices and Other Prohibited Practices
Subtitle 4. Fraudulent Insurance Acts
§ 27–403LinkCopy Citation
It is a fraudulent insurance act for a person:
(1)
knowingly to fail to return any money or premiums paid for a policy to an insured, designee of the insured, or another person entitled to the money or premiums if the insurance contracted for is not ultimately provided;
(2)
to present or cause to be presented to an insurer documentation or an oral or written statement made in support of a claim, including a claim that alleges the theft of a motor vehicle, with knowledge that the documentation or statement contains false or misleading information about a matter material to the claim;
(3)
except for the prepayment of periodic payments or excess contributions allowed under the terms of the policy, willfully to collect as a premium a sum in excess of the premium applicable to the insurance under approved classifications and rates or, for cases in which classifications and rates are not subject to approval, the premiums and charges applicable to the insurance as specified in the policy and set by the insurer;
(4)
to misappropriate or withhold unreasonably funds received or held if the funds represent premiums or return premiums;
(5)
to misappropriate benefits under a policy; and
(6)
knowingly or willfully to present, or cause to be presented, documentation or an oral or written statement made in, with reference to, or in support of an application for a viatical settlement contract, the financing of a viatical settlement contract, the transfer of a viatical settlement contract, or the settlement in support of a claim made under a viatical settlement contract with knowledge that the documentation or statement contains false or misleading information about matters material to the application, financing, transfer, settlement, or claim.
Md. Code Ann., Ins. § 27-404 (2026)
Title 27. Unfair Trade Practices and Other Prohibited Practices
Subtitle 4. Fraudulent Insurance Acts
§ 27–404LinkCopy Citation
It is a fraudulent insurance act for an insurer doing business in the State knowingly to write or place a policy or insurance contract in the State through, or pay a commission or other consideration to, a person that is required to have a certificate of qualification under this article but does not have a certificate of qualification.
Md. Code Ann., Ins. § 27-405 (2026)
Title 27. Unfair Trade Practices and Other Prohibited Practices
Subtitle 4. Fraudulent Insurance Acts
§ 27–405LinkCopy Citation
(a)
It is a fraudulent insurance act for a person to act as or represent to the public that the person is:
(1)
an insurance producer or a public adjuster in the State if the person has not received the appropriate license under or otherwise complied with Title 10 of this article;
(2)
a navigator of the Small Business Health Options Program of the Maryland Health Benefit Exchange if the person has not received the appropriate license under or otherwise complied with § 31–112 of this article;
(3)
a navigator of the Individual Exchange of the Maryland Health Benefit Exchange if the person has not received the appropriate certification under or otherwise complied with § 31–113 of this article; or
(4)
an application counselor certified by the Individual Exchange of the Maryland Health Benefit Exchange if the person has not received the appropriate certification under or otherwise complied with § 31–113(r) of this article.
(b)
It is a fraudulent insurance act for an insurance producer:
(1)
to solicit or take application for, procure, or place for others insurance for which the insurance producer has not obtained an appropriate license;
(2)
knowingly to violate § 10–130 of this article; or
(3)
intentionally to fail to report to an insurer the exact amount of consideration charged as a premium for an insurance contract, if different from the policy premium, and to fail to maintain records that show that information.
Md. Code Ann., Ins. § 27-406 (2026)
Title 27. Unfair Trade Practices and Other Prohibited Practices
Subtitle 4. Fraudulent Insurance Acts
§ 27–406LinkCopy Citation
It is a fraudulent insurance act for a person:
(1)
knowingly or willfully to make a false or fraudulent statement or representation in or with reference to an application for insurance;
(2)
to place insurance with an unauthorized insurer not regulated by the Commissioner and refuse to obey an order of the Commissioner to produce for examination all policies and other documents that evidence the insurance and the amount of premiums paid or agreed to be paid for the insurance;
(3)
if a certificate of authority is required, to operate an insurer or conduct an insurance business without obtaining a certificate of authority issued by the Commissioner;
(4)
to make a false sworn statement that the person does not believe to be true about matter material to an examination, investigation, or hearing conducted by the Commissioner; or
(5)
with intent to deceive, knowingly to exhibit a false account, document, or advertisement about the affairs of an insurer.
Md. Code Ann., Ins. § 27-406.1 (2026)
Title 27. Unfair Trade Practices and Other Prohibited Practices
Subtitle 4. Fraudulent Insurance Acts
§ 27–406.1LinkCopy Citation
(a)
In this section, “individual surety” means a person that:
(1)
issues surety bonds or contracts of surety insurance; and
(2)
does not have a certificate of authority issued by the Commissioner.
(b)
It is a fraudulent insurance act for an individual surety to solicit or issue a surety bond or contract of surety insurance except as provided in:
(1)
§§ 13–207 and 17–104 of the State Finance and Procurement Article; and
(2)
for an uncompensated person, §§ 5–203 and 5–204 of the Criminal Procedure Article.
Md. Code Ann., Ins. § 27-407 (2026)
Title 27. Unfair Trade Practices and Other Prohibited Practices
Subtitle 4. Fraudulent Insurance Acts
§ 27–407LinkCopy Citation
(a)
It is a fraudulent insurance act for:
(1)
a person, for personal gain, to solicit an individual injured by or in a motor vehicle to sue or retain a lawyer to represent that individual in a lawsuit;
(2)
a person, for personal gain, to solicit an individual injured by or in a motor vehicle to seek care from a health care practitioner; and
(3)
a lawyer or health care practitioner to employ, directly or indirectly, or in any way compensate a person for the purpose of having that person solicit or attempt to solicit clients for the lawyer or health care practitioner.
(b)
This section does not prohibit public communications or activity allowed by applicable rules of professional conduct or activity protected under the State or federal Constitution.
Md. Code Ann., Ins. § 27-407.1 (2026)
Title 27. Unfair Trade Practices and Other Prohibited Practices
Subtitle 4. Fraudulent Insurance Acts
§ 27–407.1LinkCopy Citation
It is a fraudulent insurance act for a person, with the purpose of submitting a claim under a policy of motor vehicle insurance, to organize, plan, or knowingly participate in:
(1)
an intentional motor vehicle accident; or
(2)
a scheme to create documentation of a motor vehicle accident that did not occur.
Md. Code Ann., Ins. § 27-407.2 (2026)
Title 27. Unfair Trade Practices and Other Prohibited Practices
Subtitle 4. Fraudulent Insurance Acts
§ 27–407.2LinkCopy Citation
It is a fraudulent insurance act for a contractor offering home repair or remodeling services for damages to a private residence, to directly or indirectly pay or otherwise compensate an insured, or offer or promise to pay or compensate an insured, with the intent to defraud an insurer, for any part of the insured’s deductible under the insured’s property or casualty insurance policy, if payment for the services will be made from the proceeds of the policy.
Md. Code Ann., Ins. § 27-408 (2026)
Title 27. Unfair Trade Practices and Other Prohibited Practices
Subtitle 4. Fraudulent Insurance Acts
§ 27–408LinkCopy Citation
(a)
(1)
A person that violates § 27–407 of this subtitle, or another provision of this subtitle in which the claim or act that is the subject of the fraud has a value of $300 or more is guilty of a felony and on conviction, for each violation, is subject to:
(i)
liability for restoring to the victim the property taken or the value of the property taken; and
(ii)
(1)
for a violation of any provision of § 27–403 of this subtitle, a fine, the maximum of which is the greater of three times the value of the claim or act that is the subject of the fraud and $10,000 and the minimum of which is $500, or imprisonment not exceeding 15 years or both; and
(2)
for a violation of any provision of § 27–404, § 27–405, § 27–406, § 27–406.1, § 27–407, § 27–407.1, or § 27–407.2 of this subtitle, a fine not exceeding $10,000 or imprisonment not exceeding 15 years or both.
(2)
A person that violates a provision of this subtitle in which the claim or act that is the subject of the fraud has a value of less than $300 is guilty of a misdemeanor and on conviction, for each violation, is subject to:
(i)
liability for restoring to the victim the property taken or the value of the property taken; and
(ii)
(1)
for a violation of any provision of § 27–403 of this subtitle, a fine, the maximum of which is the greater of three times the value of the claim or act that is the subject of the fraud and $10,000 and the minimum of which is $500, or imprisonment not exceeding 18 months or both; and
(2)
for a violation of any provision of § 27–404, § 27–405, § 27–406, § 27–406.1, § 27–407, § 27–407.1, or § 27–407.2 of this subtitle, a fine not exceeding $10,000 or imprisonment not exceeding 18 months or both.
(b)
(1)
The penalties imposed under this section may be imposed separately from and consecutively to or concurrently with a sentence for another offense based on the act that constitutes a violation of this subtitle.
(2)
Each act of solicitation under § 27–407 of this subtitle constitutes a separate violation for purposes of the penalties imposed under this section.
(3)
Notwithstanding any other provision of law, a fine imposed under subsection (a) of this section is mandatory and not subject to suspension.
(c)
(1)
In addition to any criminal penalties that may be imposed under this section, on a showing by clear and convincing evidence that a violation of this subtitle has occurred, the Commissioner may:
(i)
impose an administrative penalty not exceeding $25,000 for each act of insurance fraud; and
(ii)
order restitution to an insurer or self–insured employer of any insurance proceeds paid relating to a fraudulent insurance claim.
(2)
In determining the amount of an administrative penalty, the Commissioner shall consider:
(i)
the nature, circumstances, extent, gravity, and number of violations;
(ii)
the degree of culpability of the violator;
(iii)
prior offenses and repeated violations of the violator; and
(iv)
any other matter that the Commissioner considers appropriate and relevant.
(3)
If an administrative penalty is not paid after all rights of appeal have been waived or exhausted, the Commissioner may bring a civil action in a court of competent jurisdiction to collect the administrative penalty, including expenses and litigation costs, reasonable attorney’s fees, and interest.
(d)
This section does not affect an insurer’s right to take any independent action to seek recovery against a person that violates this subtitle.