Montana Code Annotated 2015

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     33-18-242. Independent cause of action -- burden of proof. (1) An insured or a third-party claimant has an independent cause of action against an insurer for actual damages caused by the insurer's violation of subsection (1), (4), (5), (6), (9), or (13) of 33-18-201.
     (2) In an action under this section, a plaintiff is not required to prove that the violations were of such frequency as to indicate a general business practice.
     (3) An insured who has suffered damages as a result of the handling of an insurance claim may bring an action against the insurer for breach of the insurance contract, for fraud, or pursuant to this section, but not under any other theory or cause of action. An insured may not bring an action for bad faith in connection with the handling of an insurance claim.
     (4) In an action under this section, the court or jury may award such damages as were proximately caused by the violation of subsection (1), (4), (5), (6), (9), or (13) of 33-18-201. Exemplary damages may also be assessed in accordance with 27-1-221.
     (5) An insurer may not be held liable under this section if the insurer had a reasonable basis in law or in fact for contesting the claim or the amount of the claim, whichever is in issue.
     (6) (a) An insured may file an action under this section, together with any other cause of action the insured has against the insurer. Actions may be bifurcated for trial where justice so requires.
     (b) A third-party claimant may not file an action under this section until after the underlying claim has been settled or a judgment entered in favor of the claimant on the underlying claim.
     (7) The period prescribed for commencement of an action under this section is:
     (a) for an insured, within 2 years from the date of the violation of 33-18-201; and
     (b) for a third-party claimant, within 1 year from the date of the settlement of or the entry of judgment on the underlying claim.
     (8) As used in this section, an insurer includes a person, firm, or corporation utilizing self-insurance to pay claims made against them.

     History: En. Sec. 3, Ch. 278, L. 1987.

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