Insurance coverages – and insurance coverage disputes – come in many shapes and sizes. The insurance coverage issues we typically handle fall into two categories. The first is uninsured and underinsured motorist claims. The second involves coverage denials – where the insurer recognizes that there was or is an insurance policy, but claims that it is not obligated to pay at all. The denial may be based upon policy language, the factual circumstances surrounding the claim, failure to pay insurance premiums, etc.

Uninsured/Underinsured Motorist Coverage

Unfortunately, many in Montana drive with little or no insurance coverage – which means that they have little or no ability to pay when they negligently injure others. But when that happens, not all is lost. Your own automobile policy, the policy covering the vehicle in which you are a passenger, or both, may provide you with the additional coverage you need:

Uninsured motorist coverage insures you against injury by someone who has no automobile insurance. For example: You purchase $100,000 in uninsured motorist coverage. A few months later, a driver without insurance runs a stop sign and injures you. Your insurer “steps into the shoes” of the uninsured driver and – depending upon your injuries and damages – will pay up to $100,000 just as if the uninsured driver had been insured for $100,000 at the time of the accident.

Montana law requires that uninsured motorist coverage be offered, but it can be disclaimed by the person purchasing the insurance. It is incredibly important and we recommend always having uninsured motorist coverage on all of your automobile policies.

Underinsured motorist coverage insures you against injury by someone who has automobile insurance, but doesn’t have enough to fully compensate you for your injuries and damages. For example: You purchase $100,000 in underinsured motorist coverage. A few months later, a driver with $50,000 in liability insurance coverage runs a stop sign and injures you. The negligent driver’s insurance company pays you the $50,000 policy limit, but you have sustained damages far in excess of that amount. Your insurer then “steps into the shoes” of the underinsured driver and – depending upon your injuries and damages – will pay up to $100,000 just as if the negligent driver had been insured for an additional $100,000 at the time of the accident. Underinsured motorist coverage is an optional coverage under Montana law. It is every bit as important as uninsured motorist coverage and we recommend always having underinsured motorist coverage on all of your automobile policies.

If you have underinsured motorist coverage, the language of your policy will typically require that you obtain the “consent” of your insurer prior to settling with the other driver. This is because your insurer will have a right to go back against that driver for any amounts it pays to you – a concept called “subrogation.” If you fully release the other driver without getting permission from your insurer, your insurer will lose its ability to subrogate and may try to avoid paying you under the policy. For that reason, if you have any questions, you should contact an attorney to review your insurance coverages and make sure that you are not waiving valuable rights or placing your underinsured motorist coverage at risk. This should be done before you sign off on any settlement with the other driver.

If you do have questions and go to an attorney, remember this: if you are very close to settlement and just checking with the attorney to make sure that you aren’t missing anything, THAT ATTORNEY IS NOT ENTITLED TO TAKE A FEE ON YOUR ENTIRE LIABILITY SETTLEMENT. Perhaps the attorney will have to do some work, in which case a reduced fee may be appropriate. But if the other side has offered you policy limits and you just want to make sure that you are doing the right thing, any attorney giving you advice should at most take a minimal fee on what has already been offered to you (and only then if they are required to do work for you).

Collecting Benefits – Generally, before recovering uninsured or underinsured motorist coverages, a party must first demonstrate that the other driver was at fault and that he or she suffered damages. When it comes to underinsured motorist benefits, the injured party must also typically collect the other driver’s liability policy limits before making a claim under his or her own insurance policy. The insurer providing underinsured motorist coverage is typically entitled to a credit for any recovery received from the underinsured motorists’ policy. This "credit" means that the underinsured motorist carrier is not obligated to pay under your policy until you have sustained damages in excess of the underlying policy limit.  For example, if you have $100,000 in coverage and the driver that injured you carried $50,000 in liability limits, your insurer's obligations don't begin until you have sustained more than $50,000 in damages.

Stacking Insurance Coverage – Uninsured motorist coverage, underinsured motorist coverage and medical payments coverage (discussed below) are "stackable" under Montana law. “Stacking” permits a person to add similar insurance coverages together, either by accessing multiple vehicles under one policy or multiple vehicles under several policies. For example, a person who purchases $100,000 in uninsured motorist coverage for five separate vehicles under five separate policies can potentially collect up to $500,000 in uninsured motorist benefits for the same accident.

Medical Payments Coverage – Commonly referred to as “med-pay.” Med-pay coverage pays medical expenses up to the amount of the coverage for each person in the med-pay insured vehicle, regardless of fault. These limits are usually in amounts of $1,000, $2,500, $5,000, or $10,000. Med-pay benefits typically do not have to be repaid where the negligent driver's insurance pays damages.

Fights Over Coverage & Coverage Disputes

Oftentimes, an insurer will deny payment of benefits because the claimant’s injury is not “covered.” It may not be covered because the policy was canceled prior to the accident. It may not be covered because the policy’s “exclusions” state that the injury falls outside of coverage. The insurer may claim that no coverage exists because the injury-causing act was “intentional.” All of these excuses may be valid – from time to time. But insurance contracts are complicated creatures, and there are black-letter legal rules as to how they are to be interpreted. Let’s say that you interpret your policy of insurance to provide coverage for an injury, and your insurer (or someone else’s insurer) disagrees. Perhaps both of your interpretations are reasonable. Then what happens? The Montana Supreme Court has repeatedly stated:

A long-standing and often-cited rule in Montana is that an insurance policy must be interpreted according to what a reasonable person in the position of an insured would understand the language to mean. An ambiguity exists when different persons looking at it in light of its purpose cannot agree upon its meaning. The complementary rule to the foregoing is that ambiguous provisions in insurance policies must be construed against the insurance company.

Infinity Insurance Company v. Dodson, 2000 MT 287, ¶ 27, 302 Mont. 209, ¶ 27, 14 P.3d 487, ¶ 27. If your interpretation is a reasonable one – even if the insurer’s is, too – there is an excellent chance to obtain policy benefits. All ambiguities in Montana are construed against the insurer. The problem is that an ordinary person simply doesn’t have the experience, training or expertise to make that determination. We have more than thirty-five years combined experience handling insurance coverage disputes. We can tell you if you have a legitimate claim, and how to best approach it if you do.

Other Insurance Coverage Issues

The above list is not exhaustive. There are any number of insurance coverage issues that can arise in any number of contexts – including medical payments coverage, advance payments, offset issues and more. And any insurance coverage issue is dangerous to handle on your own – typically, the insurer will have its own attorneys or coverage experts making its decisions. Oftentimes, you need someone, too.