Personal Injury

Insurance Claims & Bad Faith, Montana

You paid your premiums. When an insurer denies, delays, or lowballs a valid claim, Montana law gives you a way to fight back.

Written by

Misty Gaubatz, Partner, A&M Law

Licensed Montana attorney and co-founder of A&M Law. Over two decades in the practice of law focusing on family law, criminal defense, and DUI defense, with federal and state court experience and a Certificate in Mediation.

Montana Bar #122346+ years as an attorney, with over two decades working in the lawReviewed by Ashley HurlbertLast reviewed: June 19, 2026

Insurance is a promise: you pay your premiums, and the company stands behind you when something goes wrong. Too often, that promise gets broken: claims are denied without good reason, payments are dragged out for months, or a valid claim is met with an offer that doesn't come close to its real value. Montana law takes these abuses seriously, and so do we. I've negotiated against insurers and know the tactics they use.

Montana's Unfair Trade Practices Act

Montana's Unfair Trade Practices Act (UTPA), in MCA § 33-18-201, sets out the claim-handling practices insurers are forbidden from engaging in, including unreasonably denying claims, failing to investigate promptly and fairly, misrepresenting policy provisions, and refusing to pay without conducting a reasonable investigation. These standards are the backbone of a Montana bad-faith claim.

First-Party and Third-Party Bad Faith

Montana protects claimants on both sides of a policy:

First-party bad faith: when your own insurer mishandles your claim (auto, home, health, or other coverage).
Third-party bad faith: when the at-fault party's insurer mistreats the claim you bring against their insured.

Notably, Montana allows third-party bad-faith claims under § 33-18-242, a protection many states don't offer, and one that gives injured Montanans real leverage.

Recognizing Bad Faith

Watch for the red flags: a denial with no meaningful explanation, unexplained months-long delays, repeated demands for the same paperwork, misstatements about what your policy covers, or an offer far below your claim's true worth designed to pressure you into giving up. Any of these can signal that an insurer has crossed from hard bargaining into bad faith.

Holding Insurers Accountable

A successful bad-faith claim can recover not only the value the insurer should have paid in the first place, but additional damages for the harm its unreasonable conduct caused. We review exactly how your claim was handled, document the insurer's conduct, and apply the pressure of the UTPA to get you what you're owed. The consultation is free, and the call is worth making before you accept a denial as final.

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FAQ

Frequently Asked Questions

What is insurance bad faith in Montana?

Bad faith is when an insurance company fails to treat a claim fairly and reasonably. Montana's Unfair Trade Practices Act (MCA § 33-18-201) prohibits practices such as unreasonably denying a valid claim, failing to promptly investigate, misrepresenting policy terms, or forcing a claimant to litigate by offering far less than a claim is worth. When an insurer crosses that line, it can be held accountable.

Can I sue the other person's insurance company?

In Montana, often yes. Unlike many states, Montana allows third-party bad-faith claims under § 33-18-242, meaning if you're the victim of someone else's negligence and that person's insurer handles your claim unreasonably, you may have a direct claim against the insurer. This is a powerful and somewhat unusual protection for Montana claimants.

What's the difference between first-party and third-party bad faith?

First-party bad faith is when your own insurer mistreats your claim, for example, your homeowner's or auto carrier wrongly denying coverage. Third-party bad faith is when the at-fault party's insurer mishandles the claim you've made against their insured. Montana recognizes both.

What can I recover in a bad faith case?

Beyond the value of the original claim the insurer should have paid, a bad-faith claim can allow recovery for additional damages caused by the insurer's conduct. The goal is to make you whole for the harm the insurer's unreasonable handling caused, which is why insurers take these claims seriously.

How do I know if I have a bad faith claim?

Warning signs include a flat denial with no real explanation, long unexplained delays, demands for endless duplicative documentation, misrepresenting what your policy covers, or an offer far below what your claim is genuinely worth. If any of that sounds familiar, it's worth having an attorney review how your claim was handled.

Is Your Insurer Acting in Bad Faith?

Don't accept an unfair denial. Call 406-830-3060 for a free review of how your claim was handled.

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