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New Georgia Law Will Impact Auto Crash Cases

iStock_000001983354XSmall.jpgUnless you are in a car accident, work for an insurance company, or serve as a legislator or lawyer, the technical aspects of auto crash cases might not be something you think about much. But there is a new law that went into effect earlier this month and it makes some changes that are noteworthy. As an Atlanta auto injury lawyer, this is a law that will come up often in my law practice.

The new law adds requirements for auto personal injury demands which also relate to what are called insurance bad faith claims. It sets out new requirements for pre-lawsuit demands to automobile liability insurers made by injured parties. The new law is codified in Official Code of Georgia Annotated section 9-11-67.1 and will be discussed below.

Georgia law requires that when insurance companies provide liability insurance coverage to drivers that cause injury or damage to property, they must act in “good faith” when a claim is made by the injured party. After an accident, sometimes the facts warrant a claim being made that is for the full amount of the policy held by a driver who is responsible for causing such injury or property damage.

The impact of a demand for the policy limits that is not met by the insurer has been established in the Georgia courts under two major cases: Southern General Insurance Co. v. Holt and State Farm Mut. Auto. Ins. Co. v. Smoot. These cases established that when a driver is at fault for an accident and resulting injuries and property damage that exceed the limits of that driver’s policy with the insurer, the insurance company can be held accountable for the excess if it acted in bad faith in dealing with the claim.

The law in this area is significant. It means that insurance companies have to act very carefully when an injured party makes a demand to the insurance carrier for the full amount of the policy and that is denied. If the insurer doesn’t pay and a trial ensues with the actual amount of damages awarded turns out to be greater than the policy limits, the insurer can be held to pay the at-fault driver the amount in excess of the policy limits, if it acted in bad faith in failing to pay the policy amount in the first place. The insurer can also be held to pay what are called punitive damages when they act in bad faith in these situations.


Official Code of Georgia Annotated section 9-11-67.1,
sets out more specific requirements on the timing and payment of an injured party’s demands under a policy. It provides that the settlement offer must be in writing, must set out a time frame for acceptance which cannot be less than 30 days from the receipt of the offer and some other specifics such as the parties that will be released from liability if the offer to settle is accepted.

After an offer to settle is made, the recipient can seek information and clarification and this will not be deemed a counter offer. Payment is permitted in various forms including electronically, but the payment cannot be required to be made in less than ten days after the written acceptance of a settlement offer.


If you or a loved one has been injured in an auto accident, it is important to get the help you need. Please contact me at my law offices and I will consult with you on your rights at no charge to you. It is important that you avoid talking with any insurance carrier until you have spoken with a lawyer that can protect you. Provide your insurance information, but do not talk with anyone until a lawyer gives you advice on your situation and rights.

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