What you need to know about minimum car insurance coverage requirements and other auto insurance basics
Montana’s car insurance premiums are some of the lowest in the country. Nevertheless, the amount of uninsured drivers is well above the national average. What’s more, Montana is one of the most dangerous states to drive in the entire country.
Let’s take a closer look at Montana’s auto insurance system, minimum coverage requirements, and what to do if you get into a car accident with an uninsured driver in Big Sky Country.
Fault-based insurance system
Montana has a fault-based insurance system. This means that the person responsible for causing a car crash is also responsible for paying for the damages.
This is in contrast to a no-fault insurance system in which all drivers in an accident, no matter who’s responsible, turn to their own insurance policies to cover the damages (such as Florida).
In Montana, a person who suffers damages due to a car accident caused by another driver has 3 options:
- File a claim with their own insurance company (in this situation the insurance company will turn around and pursue reimbursement–subrogation–from the at-fault driver’s insurance company),
- File a third-party claim directly with the at-fault driver’s insurance company, or
- File a personal injury lawsuit in civil court against the at-fault driver.
Mandatory auto liability insurance
Liability insurance covers bodily injuries and property damage caused by the insured individual and sustained by someone other than the insured. In other words, if YOU cause a car accident, your liability insurance pays for the other person’s injuries and damages.
Montana requires that every motor vehicle on the road is covered by liability insurance.
The minimum amounts of liability coverage required in Montana are spelled out in Montana Code Annotated 61-6-103, and are as follows:
- $25,000 liability coverage for bodily injury to or death of 1 person in any 1 accident
- $50,000 liability coverage for total bodily injury to or death of 2 or more persons in any 1 accident, and
- $20,000 liability coverage for injury to or destruction of property of others in any 1 accident
Remember, the amounts listed above are the minimum requirements. In Montana, you have the option of purchasing additional liability coverage. You’re personally liable for any damages incurred above your policy limits, so the more coverage you have, the more you’re protected.
Penalties for being uninsured
Failure to maintain the required liability insurance can lead to fines. Multiple offenses can lead to increased fines, jail time, and the suspension of your registration and/or license.
On top of that, if your license or registration is suspended in Montana, you may not be able to obtain a license or insurance in another state.
Montana police use the Montana Insurance Verification System (MTIVS) to instantly lookup whether vehicles on the road are in compliance with the vehicle liability policy requirements.
What happens if the other driver doesn’t have liability insurance?
Despite the fact that liability insurance is mandatory in Montana, an estimated 15% of drivers in Montana are uninsured.
So what happens if you’re involved in an accident and the other driver doesn’t have insurance?
Uninsured motorist (UM) coverage provides coverage for bodily injury and property damage sustained by you or the passengers in your vehicle as a result of an accident involving an uninsured driver.
Insurance companies in Montana are legally required to provide UM coverage in your liability policy. But you, as the insured, have the right to reject this coverage (usually by checking a box on the policy).
If you decide to reject UM coverage and are involved in an accident with an uninsured driver, you’re only recourse will be to sue the driver for your damages via a personal injury lawsuit.
The problem with suing an uninsured driver is that a driver who doesn’t have money to purchase insurance generally doesn’t have money to pay a judgment.
Optional car insurance coverage in Montana
While your liability insurance covers damages sustained by other people involved in an accident, it doesn’t cover your damages. Even in cases when you didn’t cause an accident, it can take a long time to receive money from the at-fault driver.
In these situations, you would benefit from having a policy that covers your damages regardless of who caused the accident. Fortunately, there are a handful of these optional coverage policies available in Montana, including:
- Collision coverage. This coverage provides compensation for physical damage to your vehicle. It usually includes a deductible (the amount of the loss you pay out of pocket). Generally speaking, the higher the deductible, the less you’ll pay for your monthly insurance premium.
- Comprehensive coverage. This coverage will reimburse you for loss from theft or damage other than a collision with another car or object. Some examples include a fire, hail, flood, or cracked windshield.
- Medical Payments. This coverage pays certain medical and funeral costs for you or others in your vehicle injured or killed in an accident.
Have more questions about your rights following a car accident in Montana? If you’re confused or have questions about your auto insurance policy, there’s no reason to avoid talking to an attorney near you as consultations are usually free.
For starters, download and print these free resources to get prepared for your first consultation:
Then, we invite you to browse Enjuris’ list of Montana personal injury attorneys.