Montana body shop laws: what insurers and shops must do

What it means in Montana

The insurer, its producers and its adjusters can't require your customer to use a particular body shop for an estimate or repair, or pressure or reward them for using one. Your customer, insured or third-party claimant, can use any shop they choose, and the insurer must pay the reasonable and necessary repair cost, less the deductible. It doesn't have to pay more than the market price defined in MCA 33-18-222. On request, it must give a list of qualifying shops.

On request, the insurer must give a list of qualifying shops. It does not have to pay more than the market price defined in MCA 33-18-222.

The law's own words

“require that a claimant under the policy use a particular automobile body repair business or location for an estimate or a repair;”

MCA 33-18-224, 2025 edition

“engage in any act or practice that intimidates, coerces, or threatens a claimant or that provides an incentive or inducement for a claimant to use a particular automobile body repair business or location”

MCA 33-18-224, 2025 edition

“The claimant may use an automobile body repair business or location at the claimant's sole discretion, and the insurance company shall pay for the reasonable and necessary cost of the automobile body repair services for covered damages, less any deductible under the terms of the policy.”

MCA 33-18-224, 2025 edition

What it means in Montana

No rule in our Montana collection requires the insurer to pay storage or give notice before it stops. While you lawfully hold the car, you have a lien for the reasonable cost of storage. If the customer asks for a written estimate, it must include any storage costs. Tow truck operators who remove a wreck from a public road at police request must send the owner or lender a certified letter within 15 days.

No rule in our Montana collection requires an insurer to pay storage or give notice before it stops. The certified-letter rule covers only law-enforcement tows from a public roadway.

The law's own words

Shop

“A person who, while lawfully in possession of an article of personal property, product, or commodity renders any service to the owner or lawful claimant of the article by labor or skill employed for the making, repairing, protection, improvement, safekeeping, carriage, towing, or storage of the article or tows or stores the article as directed under authority of law has a special lien on the article.”

MCA 71-3-1201, 2025 edition

Shop

“If the service is towing or storage, the lien is for the reasonable cost of the towing or storage.”

MCA 71-3-1201, 2025 edition

Tow and storage lot

“Within 15 days after the date that a wrecked or disabled vehicle is removed from a public roadway by a qualified tow truck operator at the request of a law enforcement officer under 61-8-908, the qualified tow truck operator shall send a certified letter to the vehicle owner or lienholder”

MCA 61-8-913, 2025 edition

Shop

“If a written estimate is requested, the motor vehicle repair business shall give to the customer a written, estimated price for labor, parts necessary for the specific job, storage costs (if any) and the approximate date of work completion.”

ARM 23.19.202, effective 2/10/2006

What it means in Montana

Your lien lasts only while you have the car. A lender on the title comes first unless you send it written notice within 30 days of receiving the car; it then has 20 days after mailing to pay your lien and take the car, or your lien moves ahead of its loan. If you're not paid within 30 days after the work, you can file a lien enforcement case; after judgment, the sheriff sells the car at public auction. Your customer can ask for a hearing to contest the sale, and our collection shows no bond to get the car back.

The lienholder notice must go to the secured party within 30 days of receiving the vehicle, or the lien is junior to it. The owner may request a hearing to contest the sale. No bond or deposit release appears in our collection.

The law's own words

Keep the car

“(2) (a) A person who, while lawfully in possession of an article of personal property, product, or commodity renders any service to the owner or lawful claimant of the article by labor or skill employed for the making, repairing, protection, improvement, safekeeping, carriage, towing, or storage of the article or tows or stores the article as directed under authority of law has a special lien on the article.”

MCA 71-3-1201, 2025 edition

Lender priority

“(1) Subject to subsection (4), the lien created may not take precedence over perfected security interests under the Uniform Commercial Code--Secured Transactions or other recorded liens on the property involved unless, within 30 days from the time of receiving the property, the person desiring to assert a lien upon the property gives notice in writing to the secured party or other lienholder,”

MCA 71-3-1202, 2025 edition

Sell or title it

“If payment for work, labor, or services performed or feed or material furnished is not made within 30 days after the performance of the work, labor, or services or furnishing of the feed or material, the lienor under the provisions of this part may enforce the lien in the following manner:”

MCA 71-3-1203, 2025 edition

Sell or title it

“(b) One copy of the order to show cause provided for in subsection (5)(a) must be served on the owner by certified mail, return receipt requested, and one copy must be served by first-class mail at the owner's last address known to the lienor at least 21 days before the hearing date.”

MCA 71-3-1203, 2025 edition

Sell or title it

“(7) Upon receipt of the court's lien enforcement judgment, the sheriff shall advertise and sell at public auction as much of the property covered by the lien as will satisfy the lien. (8) The sale must be advertised, conducted, and held in the same manner as prescribed in 25-13-701(1)(b).”

MCA 71-3-1203, 2025 edition

What it means in Montana

Montana has no rule on whether the insurer can require aftermarket crash parts or what it must disclose. Your invoice must clearly say if used, rebuilt or reconditioned parts went on, unless they were remanufactured with a new-part warranty. Your customer can pick any body shop, and the insurer must pay the reasonable and necessary cost of covered repairs, up to the market price. Whether that decides which parts get paid for is a question for the Department of Insurance or a lawyer.

MCA 33-18-224 covers both the insured and third-party claimants, and does not require the insurer to pay more than the market price. The unfair claim settlement list in MCA 33-18-201 applies to acts done often enough to show a general business practice.

The law's own words

Insurer

“The claimant may use an automobile body repair business or location at the claimant's sole discretion, and the insurance company shall pay for the reasonable and necessary cost of the automobile body repair services for covered damages, less any deductible under the terms of the policy.”

MCA 33-18-224, 2025 edition

Insurer

From a list that begins: “A person may not, with such frequency as to indicate a general business practice, do any of the following:”

“(6) neglect to attempt in good faith to effectuate prompt, fair, and equitable settlements of claims in which liability has become reasonably clear;”

MCA 33-18-201, 2025 edition

Shop

From a list that begins: “It shall be an unfair or deceptive act or practice for a motor vehicle repair business to:”

“If any used, rebuilt or reconditioned parts are supplied, then the invoice shall clearly state that fact, except such parts that have been remanufactured and carry a new part warranty.”

ARM 23.19.202, effective 2/10/2006

Insurer

“This section does not require an insurer to pay more for automobile body repair services than the market price, as defined in 33-18-222.”

MCA 33-18-224, 2025 edition

What it means in Montana

Montana has no law requiring an appraisal clause or setting appraisal rules for auto claims. Your customer, insured or third party, can choose the shop, and the insurer must pay the reasonable and necessary repair cost, up to the market price. It can't ignore an operation or cost from an estimating system it agreed to use with you, and must pay total losses at actual replacement value, not book value. Whether a policy's appraisal clause helps is a question for a lawyer.

In 33-18-224, "claimant" means the insured or a third party claiming against the insurer, and the section does not require paying more than the market price defined in 33-18-222. 33-18-201 reaches conduct done often enough to indicate a general business practice.

The law's own words

Other dispute rules

“(4) The claimant may use an automobile body repair business or location at the claimant's sole discretion, and the insurance company shall pay for the reasonable and necessary cost of the automobile body repair services for covered damages, less any deductible under the terms of the policy. This section does not require an insurer to pay more for automobile body repair services than the market price, as defined in 33-18-222.”

MCA 33-18-224, 2025 edition

Other dispute rules

From a list that begins: “An insurance company, including its producers and adjusters, that issues or renews a policy of insurance in this state covering, in whole or in part, a motor vehicle may not:”

“(iii) unilaterally disregard a repair operation or cost identified by an estimating system that the insurer and an automobile body repair business or location have agreed to utilize in determining the cost of repair.”

MCA 33-18-224, 2025 edition

Other dispute rules

“Each motor vehicle insurance policy issued to residents of this state that provides that reimbursement for total loss of a motor vehicle be based on a "book" value rather than on the actual replacement value is void as to that provision, and reimbursement must be made for actual replacement value except as provided in 27-1-306.”

MCA 33-23-202, 2025 edition

Other dispute rules

From a list that begins: “A person may not, with such frequency as to indicate a general business practice, do any of the following:”

“(6) neglect to attempt in good faith to effectuate prompt, fair, and equitable settlements of claims in which liability has become reasonably clear; (7) compel insureds to institute litigation to recover amounts due under an insurance policy by offering substantially less than the amounts ultimately recovered in actions brought by the insureds;”

MCA 33-18-201, 2025 edition

What it means in Montana

Montana has no labor rate survey law. The insurer must pay the reasonable and necessary cost of covered repairs at the shop your customer chooses, less the deductible, but it doesn't have to pay more than the market price: the price you and the insurer agree on, or the prevailing competitive rate that is reasonable and necessary locally. The insurer can't ignore a cost in an estimating system you both agreed to use, and you can't charge a claimant more than an uninsured customer.

The market price may not be less than cost as provided in 30-14-209. Section 33-18-224 binds insurers that issue or renew motor vehicle policies in Montana and covers both insureds and third-party claimants; an insurer that contracts with an independent adjuster isn't liable for that adjuster's failure to comply.

The law's own words

Survey or rate standard

“"market price" means the: (a) price agreed upon between the insurer and the business; or (b) prevailing competitive rate that is reasonable and necessary in the local area where the repairs are to be performed. (2) The market price may not be less than cost as provided in 30-14-209.”

MCA 33-18-222, 2025 edition

What the insurer pays

“The claimant may use an automobile body repair business or location at the claimant's sole discretion, and the insurance company shall pay for the reasonable and necessary cost of the automobile body repair services for covered damages, less any deductible under the terms of the policy. This section does not require an insurer to pay more for automobile body repair services than the market price, as defined in 33-18-222.”

MCA 33-18-224, 2025 edition

What the insurer pays

From a list that begins: “An insurance company, including its producers and adjusters, that issues or renews a policy of insurance in this state covering, in whole or in part, a motor vehicle may not:”

“unilaterally disregard a repair operation or cost identified by an estimating system that the insurer and an automobile body repair business or location have agreed to utilize in determining the cost of repair.”

MCA 33-18-224, 2025 edition

What the insurer pays

“It is unlawful for an automobile body repair business or location to charge or agree to charge a claimant more than an uninsured customer for any automobile body repair service.”

MCA 33-18-224, 2025 edition

What it means in Montana

Montana has no rule that names paint and materials caps. If the insurer and your shop agreed to use an estimating system, the insurer can't on its own disregard a repair operation or cost that system identifies. It must pay the reasonable and necessary repair cost, but need not pay more than the market price: the agreed price or the local prevailing competitive rate. Whether a materials cut breaks these rules is a question for the Department of Insurance or a lawyer.

33-18-224 covers both the insured and a third party seeking repair. Under 33-18-242 an insured or a third-party claimant can sue for actual damages over listed claim practices, including the good faith settlement duty in 33-18-201(6); that right does not list 33-18-224. No general business practice has to be shown, the insurer isn't liable if it had a reasonable basis to contest the claim or amount, an insured has 2 years to sue, and a third party must wait until the underlying claim is settled or decided. The market price can't be less than cost.

The law's own words

What the insurer pays

From a list that begins: “An insurance company, including its producers and adjusters, that issues or renews a policy of insurance in this state covering, in whole or in part, a motor vehicle may not:”

“(iii) unilaterally disregard a repair operation or cost identified by an estimating system that the insurer and an automobile body repair business or location have agreed to utilize in determining the cost of repair.”

MCA 33-18-224, 2025 edition

What the insurer pays

“(4) The claimant may use an automobile body repair business or location at the claimant's sole discretion, and the insurance company shall pay for the reasonable and necessary cost of the automobile body repair services for covered damages, less any deductible under the terms of the policy. This section does not require an insurer to pay more for automobile body repair services than the market price, as defined in 33-18-222.”

MCA 33-18-224, 2025 edition

What the insurer pays

From a list that begins: “For purposes of 33-18-221, 33-18-223, and 33-18-224, "market price" means the:”

“(a) price agreed upon between the insurer and the business; or (b) prevailing competitive rate that is reasonable and necessary in the local area where the repairs are to be performed.”

MCA 33-18-222, 2025 edition

Related claim rule

From a list that begins: “A person may not, with such frequency as to indicate a general business practice, do any of the following:”

“(6) neglect to attempt in good faith to effectuate prompt, fair, and equitable settlements of claims in which liability has become reasonably clear;”

MCA 33-18-201, 2025 edition

Related claim rule

“(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 33-18-201(1), (4), (5), (6), (9), or (13).”

MCA 33-18-242, 2025 edition

What it means in Montana

For vehicle damage claims of $2,500 or less, the insurer must offer or pay an approved claim within 30 working days of a completed proof of loss, unless it has told the insured why it won't pay in full or asked for more documents. Another section says pay or deny within 30 days (60 if it asks for more) or owe 10% interest, but it is written around medical benefits; whether it covers vehicle claims is for the Insurance Commissioner or a lawyer.

33-18-245 covers only claims solely for property damage of $2,500 or less from motor vehicle use, and does not apply to providers who are prepaid or agree to a different payment schedule. Under 33-18-232, interest is owed only if it exceeds $5, and no private lawsuit under the unfair claims statutes may be based on compliance or noncompliance with that section. The Commissioner may fine an insurer under 33-18-233 for a general practice of slow payment, including on claims in favor of third persons. Separately, under 33-18-242 the insured or a third-party claimant can sue for actual damages caused by a failure to affirm or deny coverage within a reasonable time after proof of loss, without proving a general practice; a third-party claimant must wait until the underlying claim is settled or decided, and an insurer with a reasonable basis to contest the claim is not liable.

The law's own words

Respond

From a list that begins: “A person may not, with such frequency as to indicate a general business practice, do any of the following:”

“(2) fail to acknowledge and act reasonably promptly upon communications with respect to claims arising under insurance policies;”

MCA 33-18-201, 2025 edition

Accept or deny

From a list that begins: “A person may not, with such frequency as to indicate a general business practice, do any of the following:”

“(5) fail to affirm or deny coverage of claims within a reasonable time after proof of loss statements have been completed;”

MCA 33-18-201, 2025 edition

Accept or deny

“An insurer shall pay or deny a claim within 30 days after receipt of a proof of loss unless the insurer makes a reasonable request for additional information or documents in order to evaluate the claim.”

MCA 33-18-232, 2025 edition

If late

“If an insurer fails to comply with this section and the insurer is liable for payment of the claim, the insurer shall pay an amount equal to the amount of the claim due plus 10% annual interest calculated from the date on which the claim was due.”

MCA 33-18-232, 2025 edition

Pay

“an insurer shall make an offer to pay or shall pay all approved claims for covered services or damages that solely involve the recovery of property damages in an amount of $2,500 or less arising out of the ownership, maintenance, or use of a motor vehicle within 30 working days of receipt of a proof of loss that is correctly completed and submitted to the insurer.”

MCA 33-18-245, 2025 edition