Most bad-faith cases involve disagreements over the meaning of a particular provision of the insurance policy, the resolution of which resolves the issue of coverage. Where the insured prevails on the coverage issue in such cases, it will sometimes be because the court found the provision ambiguous and construed it…
What Is Considered Timely Demand? A proper “demand” for payment that complies with O.C.G.A. § 33-4-6 is essential to recovery. In evaluating the sufficiency of a demand, a court should consider its purpose. The purpose of the demand requirement “is to adequately notify an insurer that it is facing a…
The statute opens with the requirement that there be a “loss” covered by a policy. Thus, the insured must prove that the loss for which payment sought is covered under the insurance policy at issue. Where the claim is not covered, the insurer has no obligation to pay and there…
Although the law can guide a practitioner in interpreting the various component parts of an insurance policy, the ability to analyze a policy and render a competent coverage analysis requires certain practical considerations. An opinion regarding coverage cannot be confidently given without consideration of all of the following: Accurate Copy…
The rules of construction require the court to consider the policy as a whole, to give effect to each provision, and to interpret each provision to harmonize with each other. Additionally, a court should avoid an interpretation of a contract that renders portions of the language of the contract meaningless.…
Exclusions, Exceptions And Limitations In contrast to the grant of coverage in an insurance policy, exceptions and exclusions to coverage must be narrowly and strictly construed against the insurer and liberally construed in favor of the insured to afford coverage. A contract of insurance is construed most strongly against the…
The Reasonable Expectations Doctrine In Insurance Bad Faith The plain meaning of an insurance policy is informed by the reasonable expectations of the insured. “A contract of insurance should be strictly construed against the insurer and read in favor of coverage in accordance with the reasonable expectations of the insured.”…
Insurance Bad Faith And Common Law In addition to the cause of action for bad-faith failure to pay that is grounded in statute, Georgia recognizes a cause of action for insurance bad faith that is grounded in the common law. As explained below, common-law bad faith is associated with a…
Because an insurance policy is a contract, any dispute implicating an insurer’s bad faith will involve the meaning of the words in the insurance policy. This is true no matter the type of bad faith at issue. Construction and interpretation of an insurance policy come into play in statutory bad-faith…
Explanation of Bad Faith Failure to Pay an Insurance Claim The relationship between you and your insurance company is based on the insurance policy, which is a type of contract. If your insurance company fails to pay a valid claim, it is a breach of the insurance contract. Usually, breach…