Auto Insurance Claims: Auto Insurance Lapse ans Statute of Limitations, maryland state laws, income tax returns

Question
Hello,

I received a notice from the Maryland Department of Budget & Management indicating their 'Intent to Offset' due to an outstanding debt I had for lapse of auto insurance in 2/2001 through 4/2001.  I had no knowledge about this lapse of insurance or debt (it was never reflected on my credit report either).  

I am so frustrated with this issue as the insurance company that reported the lapse obviously has no archived record of my coverage.  I think it is outrageous at this point in time (9 yrs. later) that I am stuck trying to investigate what actually happened.  Am I going to be stuck with paying the $238.68 balance?  Or is there a statute of limitations on collecting for lapse of auto insurance?

Thanks

Answer
Hi Lisa,

This is a specific state law issue rather than a general insurance question. I am not specifically familiar with Maryland state laws, however, generally speaking, statutes of limitations do not apply to state governments regarding traffic related issues.

Some time ago I myself was forced to pay a $300.00 fine for an accident that involved my deceased father more than 25 years ago. Because our names were the same, the violation attached itself to me. Because it was so long ago there was no way for me to prove that I was inocent. So I had to pay the fine in order to move on with my life. Had I not paid the fine, my drivers license would have been revoked indefinitly.

I would suggest that you contact the state agence to see if there is anything you can do. In the end unless you have absolute written proof that you had insurance during the time period in question, you will likely have to pay what the are asking. If they have already issued an "intent to Offset", that generally means they will take any income tax returns you may have comming in order to pay off the penalty.

I hope this helps
Richard Hixenbaugh