You Did Your Part. Your Insurance Company Should Do Theirs.
At Western Justice Associates, our attorneys are recognized by Best Lawyers in America for insurance law and insurance litigation. We know how insurers operate and what Montana law requires of them.
Montana Law Requires Insurers to Treat You Fairly
Montana has some of the strongest insurance consumer protections in the country. The Montana Unfair Trade Practices Act, found at Montana Code Annotated Section 33-18-201, lists claim handling practices that insurers are prohibited from using. Among other things, insurers may not neglect to attempt in good faith to effectuate prompt, fair, and equitable settlements of claims in which liability has become reasonably clear.
Montana law also gives you the power to enforce these rules. Under MCA Section 33-18-242, an insured or a third-party claimant has an independent cause of action against an insurer for actual damages caused by the insurer’s violation of specific provisions of the Unfair Trade Practices Act. That means both policyholders and people making a claim against someone else’s insurer can have a path to recovery.
Common Signs of Insurance Bad Faith
Bad faith doesn’t always look dramatic. Often it shows up as a pattern of small tactics designed to wear you down. Here are the warning signs we see most often.
The Insurer Drags Out Your Claim
Insurance companies have a duty to handle claims promptly. Some deliberately slow down, asking for the same documents again and again, reassigning your file to new adjusters, or sitting on your claim for months even though they already have what they need.
Delay is a pressure tactic. The longer you go without payment, the more desperate you may become to accept whatever they offer. An unreasonable delay with no legitimate justification can be a sign of bad faith.
Your Claim Is Denied With No Real Explanation
You have the right to know why your claim was denied and what policy language the insurer is relying on. A one-line denial, a vague reference to “policy exclusions,” or a refusal to answer your questions should raise red flags.
Sometimes insurers deny claims based on a strained reading of the policy that no reasonable person would accept. Sometimes they deny claims without looking at all the facts. Either way, a denial that can’t be clearly explained deserves a closer look by an attorney.
The Insurer Never Really Investigated
Before an insurance company says no, it must conduct a fair and reasonable investigation. That means reviewing your medical records, talking to witnesses, examining the damage, and considering evidence that supports your claim, not just evidence that hurts it.
An insurer that goes looking only for reasons to deny, ignores your doctor’s opinions, or never inspects the damage is not investigating in good faith. Montana law specifically prohibits refusing to pay claims without conducting a reasonable investigation.
The Adjuster Misrepresents Your Coverage
You rely on your insurer to tell you the truth about your policy. If an adjuster tells you something isn’t covered when it is, says you’re not entitled to benefits you actually have, or misstates deadlines or requirements, that misrepresentation may violate Montana law.
This is one reason you should always request explanations in writing and compare them against the actual policy language. What an adjuster says on the phone isn’t always what your policy says on paper.
You Get a Lowball Offer
An offer that is far below what your claim is reasonably worth, especially when liability is clear, may be a sign that the insurer is not dealing with you fairly.
Your Calls and Emails Go Unanswered
An insurer that won’t return calls, ignores your letters, or fails to update you on your claim’s status is failing in its basic duties. Some insurers also wait too long to request needed documents and then blame you for the delay. This kind of stonewalling is often meant to frustrate you into giving up.
The Insurer Threatens Your Policy
Some insurers use threats of cancellation, nonrenewal, or premium increases to scare policyholders into dropping a claim or settling for less. Using your policy as leverage to avoid paying a valid claim is an unfair practice. If an insurer pressures you this way, talk to a lawyer right away.
Montana’s Advance Payment Rule: A Protection Many People Don’t Know About
Montana offers injured people a protection that most states don’t. In Ridley v. Guaranty National Insurance Co., the Montana Supreme Court held that when liability is reasonably clear, an insurer must pay an injured third party’s medical expenses as they are incurred, rather than waiting for a final settlement. These are often called “Ridley payments.”
The court has explained that this is a two-part test: whether liability is reasonably clear, and whether it is reasonably clear that a medical expense is causally related to the accident. Later decisions have extended the rule beyond medical bills. One decision noted that nothing in Ridley suggests its scope should be categorically limited to medical expenses, and advance payments have included lost wages.
What You Can Recover in a Montana Bad Faith Case
When an insurer violates Montana’s Unfair Trade Practices Act, you may be able to recover the damages its conduct caused. Depending on your case, these can include the benefits you were wrongly denied, financial losses caused by the delay or denial, and other harm that flowed from the insurer’s misconduct.
Montana law also allows punitive damages in serious cases. Punitive damages may be available when there is clear and convincing evidence that the insurer engaged in actual fraud or actual malice in handling the claim. Punitive damages are meant to punish especially wrongful conduct and discourage insurers from doing it again.
Don’t Wait: Bad Faith Deadlines Are Short in Montana
Montana’s deadlines for bad faith claims are shorter than the general three-year deadline for personal injury lawsuits. Under Montana law, the statute of limitations for a UTPA claim is two years from the date of violation for an insured, and one year from the date of settlement or entry of judgment on the underlying claim for a third-party claimant.
There are also important rules about which legal theories you can bring. Because these rules are technical and the deadlines are short, it is important to speak with an attorney as soon as you suspect your insurer is acting in bad faith.
What to Do If You Suspect Bad Faith
If you think your insurance company is treating you unfairly, take these steps to protect yourself:
- Keep everything in writing. Save every letter, email, denial notice, and settlement offer. Follow up phone calls with an email summarizing what was said.
- Get a copy of your full policy. Request the complete policy, including all endorsements, not just the declarations page.
- Ask for written explanations. If your claim is denied or delayed, ask the insurer to identify the specific policy language and facts it relied on.
- Keep a claim log. Note the date, time, and name of every person you speak with and what they told you.
- Don’t sign a release or accept a final offer without advice. Once you sign, you may lose the right to seek more.
- Talk to a Montana insurance attorney. An experienced lawyer can tell you whether the insurer’s conduct crosses the line and what deadlines apply to you.
How Western Justice Associates Can Help
Insurance companies have teams of adjusters and lawyers protecting their bottom line. You deserve someone protecting you. At Western Justice Associates, our attorneys handle insurance disputes and bad faith claims for injured Montanans and policyholders across the state. Domenic A. Cossi and Maxwell E. Kirchhoff are recognized by Best Lawyers in America in insurance litigation, and Maxwell Kirchhoff is also recognized in insurance law.
We review your policy, your claim file, and the insurer’s conduct. We hold insurers to the standards Montana law requires, and when they refuse to do the right thing, we are prepared to take them to court.
Contact Western Justice Associates Today
If your insurance company is delaying, denying, or lowballing your claim, you don’t have to accept it. Call Western Justice Associates at (406) 587-1900 for a free consultation. We serve clients throughout Montana from our offices in Bozeman and Missoula.
We handle injury and bad faith cases on a contingency fee basis, so you pay nothing unless we recover compensation for you.