Montana Uninsured & Underinsured Motorist Coverage

UM and UIM solve different insurance problems

Both coverages can protect an injured insured when the responsible motorist's liability insurance is inadequate. The legal trigger, however, is different.

Montana requires UM unless the named insured rejects it

MCA § 33-23-201 provides that a qualifying motor-vehicle liability policy issued for a vehicle registered and principally garaged in Montana must provide uninsured-motorist bodily-injury coverage in limits corresponding to Montana's statutory bodily-injury liability limits.

The named insured has the right to reject the coverage. If UM was previously rejected in connection with a policy issued by the same insurer, the insurer generally need not provide UM on renewal unless the named insured later requests it in writing.

Statutory UM bodily-injury floor

Those figures are minimums. The insured may have purchased higher UM limits, so the declarations and applicable endorsements remain essential.

What is an uninsured motor vehicle?

Section 33-23-201 defines an uninsured motor vehicle as a land motor vehicle whose ownership, maintenance or use is not insured or bonded for bodily- injury liability at the time of the accident.

The operative policy may address additional circumstances such as an unidentified motorist, a liability insurer's denial of coverage or other policy-defined events. Those provisions must be read against Montana's statutory UM requirements.

Montana statutory UM protection follows the insured person

Montana has long treated statutory uninsured-motorist protection as personal coverage rather than coverage tied exclusively to the vehicle identified on the declarations.

Jacobson: an owned-but-uninsured vehicle exclusion could not defeat statutory UM

In Jacobson v. Implement Dealers Mutual Insurance Co., 196 Mont. 542, 640 P.2d 908 (1982), the insured was killed while operating a vehicle other than the pickup on which the UM policy was written.

The Montana Supreme Court rejected the owned-but-uninsured vehicle exclusion because the statutory UM protection before it was personal to the insured and was not limited to occupancy of the vehicle identified on the policy.

An unidentified vehicle does not have to make physical contact

In McGlynn v. Safeco Insurance Companies of America, 216 Mont. 379, 701 P.2d 735 (1985), an unidentified vehicle crossed the centerline. The insured vehicle swerved to avoid it and struck a bridge abutment.

The Montana Supreme Court held that an insurer could not impose physical contact as a prerequisite to statutory UM coverage because § 33-23-201 contains no such requirement.

UIM is not generally mandated by Montana's UM statute

MCA § 33-23-201 creates Montana's statutory UM requirement. It does not generally require an automobile insurer to provide UIM coverage.

When UIM has been purchased, begin with:

• who qualifies as an insured;
• how the policy defines an underinsured motor vehicle;
• the stated UIM limit;
• applicable exclusions;
• offset or credit provisions;
• other-insurance provisions;
• settlement and subrogation provisions; and
• current stacking rules.

Stutzman: optional UIM begins with the contract

In Stutzman v. Safeco Insurance Co. of America, 284 Mont. 372, 945 P.2d 32 (1997), Montana emphasized that UIM was not statutorily mandated and enforced the clear UIM definition at issue.

That does not mean every UIM exclusion is automatically valid. Purchased coverage remains subject to Montana's contract, reasonable-expectations and public-policy doctrines.

Purchased UIM coverage cannot be reduced to an illusion

Montana decisions repeatedly examine whether an insurer accepted valuable consideration for first-party protection and then attempted to use the policy structure to make that promised protection unavailable.

Bennett: UIM can be personal and portable

In Bennett v. State Farm Mutual Automobile Insurance Co., 261 Mont. 386, 862 P.2d 1146 (1993), the insured was struck as a pedestrian and sought UIM protection under separate policies for which separate premiums had been paid.

The decision became a principal Montana authority for treating the UIM coverage before the Court as personal and portable.

Goss: an impossible condition could not defeat purchased UIM

In Goss v. USAA Casualty Insurance Co., 2021 MT 289, the named insured was injured while riding his own motorcycle. His auto policy purported to condition UIM protection on insuring that motorcycle with USAA, but USAA did not offer motorcycle insurance in Montana.

The Montana Supreme Court rejected use of that impossible condition to defeat the purchased UIM coverage. The Court treated the UIM and MedPay provisions separately and did not simply invalidate every owned-vehicle limitation.

Before calling a vehicle “underinsured,” identify all applicable liability insurance

UIM analysis is not necessarily limited to the insurance policy carried personally by the negligent driver.

Mecca: find all applicable liability insurance first

In Mecca v. Farmers Insurance Exchange, 2005 MT 260, the negligent driver was operating a U-Haul truck. Although the driver's individual liability protection was limited, U-Haul had substantial applicable bodily- injury liability insurance.

The case illustrates why a UIM investigation must identify all potentially applicable liability coverage tied to the driver, owner, employer, rental company and other responsible entities before concluding that the involved vehicle is underinsured under the operative UIM policy.

Liability settlement, exhaustion and subrogation require a separate UIM analysis

A claimant often reaches the UIM stage while negotiating settlement with the responsible motorist or liability insurer. Montana law does not reduce that process to a rule that the claimant must always collect every dollar of every liability limit before the UIM claim can proceed.

Augustine: complete exhaustion is not an absolute prerequisite

In Augustine v. Simonson, 283 Mont. 259, 940 P.2d 116 (1997), claimants settled with the tortfeasor for less than the available liability limit and reserved their UIM claims.

The Montana Supreme Court held that an exhaustion clause requiring complete exhaustion of the tortfeasor's liability insurance as a prerequisite to UIM recovery conflicted with Montana public policy to the extent described in the decision.

For an individual claimant, the UIM carrier receives the appropriate credit for the tortfeasor's liability limit, so voluntarily accepting less than that limit ordinarily does not require the UIM carrier to fill the claimant's self-created settlement gap.

Sorensen: release does not automatically forfeit UIM

In Sorensen v. Farmers Insurance Exchange, 279 Mont. 291, 927 P.2d 1002 (1996), the insured settled with and released the tortfeasor without first obtaining the UIM carrier's permission.

Montana adopted a material-prejudice approach rather than automatic forfeiture. A UIM carrier seeking to defeat otherwise applicable coverage based on loss of subrogation must establish material prejudice under the circumstances addressed by the case.

Multiple UM/UIM policies require current-law stacking analysis

Montana has a substantial body of case law concerning personal first-party coverage, separate premiums and aggregation. Bennett and Hardy are central historical authorities.

Current claims, however, must begin with the present version of MCA § 33-23-203.

Current § 33-23-203 framework

Unless a policy specifically provides otherwise, current § 33-23-203 establishes rules for determining available limits and permits same-company limits to remain separate when the statutory conditions are satisfied, including actuarial treatment, filed rates and written notice concerning the limits and whether coverage may be added.

Parish: one UM premium and enforceable non-stacking language

In Parish v. United Financial Casualty, 2012 MT 116, the insureds had two vehicles on the policy but the evidence showed a single UM premium that did not change with the number of vehicles. The policy clearly prohibited stacking.

The Montana Supreme Court affirmed the non-stacking result under the post-2007 statutory framework.

Continue to the Montana Stacking & Multiple Insurance Policies guide →

Rideshare activity can change UM/UIM coverage

Montana permits a personal auto insurer to exclude coverage for losses occurring while a driver is logged on to a transportation-network carrier's digital network or engaged in a prearranged ride.

MCA § 69-12-345 expressly allows such exclusions to extend to UM, UIM, MedPay and other listed personal-auto coverages. The TNC itself is subject to the insurance requirements in § 69-12-343, including statutory UM where required.

Read the Montana Rideshare & Transportation Network Coverage guide →

UM/UIM claim workflow

The order matters. Determine the complete liability-insurance picture before deciding whether the first-party UM or UIM coverage has been triggered.

Documents and evidence to obtain

• complete auto policy
• declarations page
• all endorsements
• policy history
• UM limits
• UM rejection documentation
• UIM limits
• definition of insured
• definition of uninsured motor vehicle
• definition of underinsured motor vehicle
• owned-vehicle exclusions
• household exclusions
• other-insurance clauses
• anti-stacking provisions
• premium history
• separate premium amounts
• written § 33-23-203 coverage notices
• rate-filing information where relevant
• all liability policies
• umbrella and excess policies
• liability settlement offers
• liability settlement agreement
• proposed release
• UIM notice correspondence
• consent-to-settle communications
• subrogation provisions
• asset or collectibility information where relevant
• coverage correspondence
• rideshare app-status records where applicable

Common UM/UIM mistakes

• Assuming UM and UIM are the same coverage.
• Assuming UIM exists because UM appears on the declarations.
• Failing to investigate a missing UM rejection.
• Assuming UM applies only while occupying the scheduled vehicle.
• Assuming a phantom vehicle must physically strike the insured vehicle.
• Failing to gather evidence proving an unidentified vehicle caused the crash.
• Assuming liability insured status automatically establishes UIM insured status.
• Deciding a vehicle is underinsured before finding all liability insurance.
• Assuming the tortfeasor's personal policy is the only liability coverage.
• Assuming liability limits must always be completely exhausted before UIM begins.
• Releasing the tortfeasor without analyzing UIM subrogation consequences.
• Treating Sorensen as permission to ignore the UIM carrier before settlement.
• Assuming every separate premium automatically produces stacking today.
• Applying Hardy without current § 33-23-203.
• Ignoring TNC exclusions when rideshare activity is involved.

Montana authority map