In Ridley v. Guaranty National Company, the Montana Supreme Court interpreted provisions of the Unfair Trade Practices Act (UTPA) as requiring insurers to pay for medical expenses incurred by a third-party claimant when liability for the damages is reasonably clear.
The UTPA is a state law that aims to protect consumers from unfair and deceptive trade practices. Under the UTPA, insurance companies have a duty to act in good faith when handling claims, which includes paying for reasonable and necessary medical expenses related to a covered accident.
The Ridley case established that if an insurance company fails to pay for medical expenses that are reasonably related to a covered accident and are incurred by a third-party claimant, it could potentially be in violation of the UTPA. This could allow the third-party claimant to seek damages for bad faith handling of the claim.
