MONTANA SELF INSURERS’ ASSOCIATION - MSIA

Subrogation in Workers’ Compensation

Montana is the only state which does not permit subrogation within our workers’ compensation system.  

Subrogation is a legal term which means that those who are responsible for injuries or damage, reimburse those who have already paid for those injuries or damages as required by contract or law. In workers’ compensation, if it were permitted by our law, it means the employer pays the medical and lost wages, and if the accident was caused by someone else, outside the employment, the employer is reimbursed by that responsible party or their insurance.  

Subrogation works everywhere else except Montana. And, in Montana, it applies for all insurance coverage except workers’ compensation. So, by law, we have required our employers to be responsible for drunk drivers who injure their workers.  

Let us provide an example (that’s not so hypothetical). Let’s say a drunk driver, being responsibly pursued by the police from the scene of a prior accident, crashes into your work truck and you are injured. You were at work, doing your job, safely driving to or from a job-site. Workers’ compensation provides your statutory benefits, as it should. Your employer has paid for your medical care and has replaced your lost wages as required by law. Although your damages were caused by a drunk driver, the drunk driver has no responsibility to your employer for them.  

The drunk driver cannot be sued by your employer because there was no relationship between the damages they caused and the employer. The drunk can be sued for the damage to the employer’s vehicle, but not the worker. The drunk driver injured you, not your employer. Under current Montana law, the drunk driver does not owe anything to the employer. They may be required to pay you, but you have no requirement to reimburse your employer either.  

Is this fair? Current Montana workers’ compensation law permits those outside the employer’s control, to walk away from their responsibilities when they cause an accident. We allow drunk drivers to cost our employers money and impact our workers’ lives. 

How in any way, is this fair? 

MSIA supports permitting the employer the opportunity to be able to subrogate for at least some of the medical costs incurred because of someone else’s fault. That helps Montana business, that helps Montana workers and it helps our communities by making those responsible, accountable for their accidents.