The Georgia Declaratory Judgment Act Many lawsuits involving insurance coverage or an insurer’s bad faith unfold in the context of a declaratory judgment. This addresses those issues specific to a declaratory judgment action involving insurers and insureds. The Georgia Declaratory Judgment Act, O.C.G.A. § 9-4-1 et seq. provides a mechanism…
Parties As in any litigation, an insured filing suit against its insurer must name the proper party. Litigation involving insurance companies can present challenges in this regard, as many insurers operate myriad companies under similar names. For example, the Georgia Secretary of State website lists no fewer than eight entities…
The Holt court observed that “[a]n insurance company does not act in bad faith solely because it fails to accept a settlement offer within the deadline set by the injured person’s attorney.” Quoting a federal district court applying Oregon law, the Holt court went on to state as follows: Nothing…
“Safe Harbor”: Liens Involved The Georgia Court of Appeals has recently created a “safe harbor” for an insurer presented with an opportunity to settle a claim that involves certain healthcare liens. S. Gen. Ins. Co. v. Wellstar Health Sys., Inc., provides a typical example of the manner in which a…
The Rule Of Plain Meaning The insurer and the insured are bound by the plain and unambiguous terms of the insurance contract. In construing a contract, a court first “determine[s] if the instrument’s language is clear and unambiguous.” “If the language is unambiguous, the court simply enforces the contract according…
Statute of Limitations Actions upon written contracts must be brought within six years. The six-year period of limitations applies to insurance policies. On its face, O.C.G.A. § 33-4-6 does not include its own statute of limitations. The six-year statute of limitations for simple written contracts applies to bad-faith actions, because the…
EXPERT WITNESSES IN COMMON-LAW BAD-FAITH ACTIONS The crux of the typical common-law bad-faith lawsuit turns on the reasonableness of the insurer’s decision to decline an opportunity to settle within policy limits. In some cases expert testimony regarding the insurance company’s actions could be helpful for the trier of fact in…
Acceptance and Rejection of The Time-Limited Demand The law of contract formation with respect to offers, counteroffers and rejections informs whether an insurer fails to take advantage of an offer to settle within policy limits. Accordingly, when negotiating a possible settlement within policy limits, the following rules apply: The offeror…
The common occurrence of a written Holt demand notwithstanding, there is no requirement under Georgia law that the insurer’s failure to settle within policy limits be proven by the insurer’s failure to accept a formal, written demand within a stated time. Rather, the law requires an inquiry into “whether the…
Bad Faith and Claims by a Third Party for Property Damage to Automobile A statute modeled after O.C.G.A. § 33-4-6 provides a remedy for third parties with claims for property damage under a tortfeasor’s automobile liability policy. O.C.G.A. § 33-4-7(a) provides: In the event of a loss because of injury…