Georgia Bad Faith Insurance Attorneys


May 25, 2013

Montlick and Associates represents insurance policyholders throughout Georgia who are dealt with unfairly by their insurance company.

Georgia law requires that insurers must act reasonably and in good faith in evaluating claims by their policyholders and must give equal consideration to the interests of their policyholders.

 Unfortunately, the pressure to increase its profits often drives the decisions of an insurance company. All too frequently insurers make decisions that place their company's profitability ahead of its obligation to protect the people and businesses from whom it has collected premiums.

An insured may have a bad faith claim against its insurance company when the insurance company fails to pay a valid claim, refuses to pay the actual value of the claim or otherwise engages in tactics of delay, intimidation or unfairness. If the insurer declines to pay a demand within policy limits and a judgement is rendered in excess of the limits, the insured may file suit against the insurer for bad faith or negligent refusal to settle. If the insured proves either, the insurance company must pay the excess amount.

Under Georgia law, the courts define the relationship between insurance companies and their policyholders as a "fiduciary" relationship. This relationship requires that the insured uphold the obligations required of it under an insurance contract in trust and good faith. The insurance company has an obligation to search for a basis to pay the claim instead of searching for a ground to deny the claim.

Bad faith on the part of the insurance company may include:

  • If an insurance provider delays a policyholder’s benefits that are based on legitimate claims filed under valid insurance policies, this may constitute bad faith. Insurance companies are required to pay or deny a claim within a reasonable period of time. The insurer may not unnecessarily delay the adjustment of the claim or require unreasonable paperwork or documentation as a means to extend a claim.
  • An insurer that fails to provide information to a policyholder regarding their claims or benefits may be found to be acting in bad faith. The insurance company may not withhold material facts or misrepresent information that is pertinent to its policyholder's claim.
  • The denial of a policyholder’s valid claim or justified benefits may constitute bad faith. If the claim is denied, the insurer must explain to the insured the reason for denial and the policy provision supporting that denial.

Proving Bad Faith in First Party Insurance Claims

First party insurance is insurance that directly compensates an insured for the insured’s losses. Automobile insurance, homeowner's insurance, commercial insurance are all examples of first party insurance. In Georgia, there is no common law tort for bad faith related to failure to pay claims involving first party insurance.

The common law action for bad faith in Georgia was replaced by a statutory remedy. An insurance company that acts in bad faith may be liable to the insured, in addition to the loss itself, of not more than 50 percent of the liability or $5,000, whichever is greater, and all the reasonable attorney’s fees. Bad faith, under the Georgia statute, is defined as a "frivolous and unfounded refusal to pay a claim."

In order to establish bad faith, the insured must meet the technical requirements of the above statutory remedy. A proper demand of a specific dollar amount must be communicated by the insured. The insured must alert the insurer that bad faith is being alleged and allow them 60 days to pay the claim. If the insurer does not pay the claim within the time limit, then the insured may proceed to court and obtain a judgement. If the judgement is equal to or in excess of the claimant's demand, then bad faith penalties are to be awarded.

Third Party Claims and Personal Injury

Third party insurance claims involve coverage of someone who causes you injury through their negligent or reckless conduct. These types of bad faith claims may range from a claim brought against a business for a slip and fall accident to a claim based on an auto accident with a distracted driver. When you are hurt in an auto accident and the other insurance company stonewalls you or your attorney, they may be acting in bad faith. There are no statutory limits to the amount of recovery allowed in these cases.

Depending on the circumstances of your situation, an insurance company that acts in bad faith may be liable for punitive damages for violating its contractual obligations. Our Georgia bad faith insurance attorneys may be able to help you seek fair compensation for your claim if an insurance company is dealing with you unfairly. We may even be able to seek punitive damages.

If you have faithfully paid your premiums, you have a right to expect your insurance company to live up to its contractual obligations if you need to make a claim. We have represented thousands of people throughout Georgia just like you so call Montlick & Associates today to see how we can help. Our Georgia bad faith insurance attorneys are available to assist clients throughout all of Georgia, including but not limited to Albany, Athens, Atlanta, Augusta, Columbus, Gainesville, Macon, Marietta, Rome, Roswell, Savannah, Smyrna, Valdosta, Warner Robins and all smaller cities and rural areas in the state. Call us today for your free consultation at 1-800-LAW-NEED (1-800-529-6333), or visit us on the web at www.montlick.com. No matter where you are in Georgia, we are just a phone call away and we will even come to you.

Category: Montlick Law

Please Note:
Many of our blog articles discuss the law. All information provided about the law is very general in nature and should not be relied upon as legal advice. Every situation is different, and should be analyzed by a lawyer who can provide individualized advice based on the facts involved in your unique situation, and a consideration of all of the nuances of the statutes and case law that apply at the time.