Montana's Auto Insurance: Understanding No-Fault Claims And Policies

Montana is not a no-fault state for auto insurance. It is an at-fault or tort state, which means that the person at fault for a car accident is responsible for paying for other people's injuries and property damage resulting from the accident. In a no-fault state, drivers are required to carry personal injury protection (PIP) insurance to pay for their own medical expenses after a car accident, regardless of fault. In Montana, this is not required.

Montana is a tort state

In a tort state, the person who is at fault for an accident is legally responsible for the financial consequences. For example, if someone runs a red light and hits another car, they are likely to be liable for the injured party's medical bills, vehicle damage, pain and suffering, lost wages, and other financial losses.

Montana's tort system has benefits and drawbacks. On the one hand, mandatory insurance requirements contribute to a decrease in uninsured motorists on the road. On the other hand, the minimum insurance requirements in Montana are rather low, and purchasing additional coverage is recommended to protect assets adequately.

In contrast, a no-fault car insurance system, which is in place in about 30% of US states, allows a driver to receive compensation for damages directly from their own insurance policy, regardless of who caused the accident. There is no need to prove fault or liability.

The minimum insurance requirements in Montana

Montana is a tort state, also known as an at-fault state. This means that the driver deemed responsible for an accident must use their insurance to pay for the damages incurred by the other driver. In other words, if you are injured in an accident, the negligent person or entity responsible for your injury will be responsible for paying for your damages.

Montana law requires all drivers to hold liability car insurance to help cover costs associated with injury and property damage in an accident for which they are at fault. The minimum insurance requirements in Montana are as follows:

• $25,000 for bodily injury, per person
• $50,000 for total bodily injury of multiple people hurt in an accident
• $20,000 for property damage

Many drivers may feel that meeting the minimum car insurance requirements in Montana does not fully protect them. Therefore, it is recommended to increase liability insurance limits and consider additional protections that are optional under Montana law, such as collision and comprehensive coverages, medical payments insurance, and uninsured and underinsured motorist insurance.

The consequences of driving without insurance in Montana

Driving without insurance in Montana can lead to serious consequences, including fines, jail time, and license suspension. Here are the details:

Fines and Imprisonment

Driving without insurance in Montana is considered a misdemeanor, and the penalties increase with the number of offenses. For a first offense, a fine ranging from $250 to $500 may be imposed. A second offense within five years results in a $350 fine, while a third or subsequent offense leads to a $500 fine, up to 10 days in county jail, or both. Repeat offenders who are caught driving uninsured three or more times can face up to six months in jail, in addition to a fine.

License and Registration Suspension

Upon a second or subsequent conviction, the court will order the surrender of the vehicle registration and license plates. The vehicle's registration will be suspended until proof of insurance is provided, and there will be a waiting period of 90 days for a second offense and 180 days for a third offense before reinstatement. For a fourth or subsequent offense within a five-year period, the court will also order the surrender of the driver's license, which cannot be reinstated until the necessary liability coverage is obtained.

Increased Insurance Rates

Having a misdemeanor for an insurance lapse on your driving record can result in higher auto insurance rates in the future. Insurance carriers consider suspensions and revocations on your driving record, and you may be designated as a high-risk driver, making it challenging to obtain an auto insurance policy in the voluntary market.

Financial Liability

In the event of an accident, you will be held financially responsible for all losses and damages incurred. Without adequate insurance coverage, you may face significant financial challenges in covering these expenses.

The process of filing a car accident claim in Montana

Montana is a fault-based insurance state, which means that the driver who is legally responsible for an accident must compensate those who are injured or whose property is damaged. This is also known as an "at-fault" state.

If you've been in a car accident in Montana, here is a step-by-step guide on how to file a claim:

• Ensure everyone's safety: The first step is to check on all parties involved and call for medical help if necessary.
• Report the accident to the police: It is important to have an official record of the accident, and in some cases, it may be required by law. In Montana, you are required by law to report the accident to the police if it resulted in injury, death, or property damage exceeding $1,000. You must also file a written report with the Montana Motor Vehicle Division within 10 days if there is a death or injury, or property damage exceeds $1,000.
• Collect evidence at the scene: Gather essential details about the accident, including photographs of the scene, witness information, and the other driver's details.
• Contact your insurance company: Report the accident to your insurer as soon as possible. They will guide you on the next steps and let you know what documents you need to support your claim.
• File your claim: Submit the claim to your insurance company along with all the necessary supporting documentation. This may include the police report, photographs of the accident, medical records, and receipts for any expenses related to the accident.
• Follow up with the insurance company: The insurance company will investigate your case and determine the amount of compensation, if any, that you are entitled to. They will either offer you a settlement or deny your claim. If you are having problems with your settlement, you can appeal to a claims supervisor or file a complaint with the Montana Commissioner of Securities and Insurance (CSI).

It is important to act promptly when filing a car accident claim in Montana. While there is a three-year statute of limitations for personal injury lawsuits and a two-year limit for property damage claims, insurance companies typically require you to make a claim within a reasonable time after the accident, usually a matter of days or a few weeks.

How Montana's insurance costs compare to no-fault states

Montana is a tort state, also known as an at-fault state, meaning that in the event of a car accident, the driver who caused it would use their insurance to pay for the damages incurred by the other driver. In other words, if you are injured in an accident, the negligent person or entity responsible for your injury would be legally obliged to pay for your damages.

Montana's motor vehicle insurance requirements can be found in Mont. Code § 61-6-103 (2023). Any motor vehicle that is registered and driven on public roads must be insured by a liability insurance policy with the following minimum coverage limits:

• $25,000 for bodily injury to, or the death of, one person in an accident
• $50,000 for bodily injury to, or the deaths of, two or more people in an accident
• $20,000 for property damage in an accident

The average annual cost of car insurance in Montana for a full coverage policy is around $1,107. If you choose a minimum coverage policy, the annual cost drops significantly to approximately $391. Montana's average cost of car insurance is lower than the national average, which is $1,317 annually for full coverage and $607 per year for state minimum coverage.

Montana's auto insurance costs are moderate compared to no-fault states. For example, the average annual cost of car insurance in Florida, a no-fault state, is $1,439 for full coverage and $930 for minimum coverage. In another no-fault state, Michigan, the average annual cost of car insurance is $2,532 for full coverage and $1,203 for minimum coverage.

Frequently asked questions