Articles Tagged with insurance

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Haggling with insurance companies following a car accident is an everyday occurrence for many Georgia motorists. At the end of the day, an insurance policy is a contract, and if the insurer refuses to pay a valid claim, it can be held liable under Georgia law. Specifically, Section 33-4-6 of the Official Code of Georgia Annotated states that an auto insurer that rejects a claim “in bad faith” must pay not only for the policyholder’s losses, but also a penalty equal to greater than $5,000 or 50% of the insured party’s total liability.

Stiegel v. USAA Casualty Insurance Company

Could an insurer face liability beyond that provided under Section 33-4-6? According to a recent ruling by a federal judge in Columbus, the answer may be yes. In this case, an accident victim is alleging not just bad faith, but also potential violations of state racketeering laws.

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Each year more than 300 people die on Georgia roadways in drunk driving accidents. While prosecutors can file criminal charges against the drunk driver, that does not compensate victims and their families for their losses. Unfortunately, in many cases the drunk driver either has no insurance or lacks sufficient coverage to fully compensate the victims.

This is where uninsured and underinsured motorist (UM/UIM) coverage can come into play. Under Georgia law, all auto insurance providers must offer UM/UIM coverage as part of their standard policies. The customer has the option to decline such coverage, but must do so in writing. While you are free to purchase any amount of UM/UIM insurance that an insurer offers, state law sets minimum coverage at $25,000 for bodily injury per person (or $50,000 per accident). In many cases, it is a good idea to purchase significantly more coverage, as the damages from an accident can easily exceed $50,000, especially if there is serious injury or death.

Allstate Property and Casualty Insurance Company v. Musgrove

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Many single-car accidents are the result of a defective part. If that is the case, the driver may have a personal injury claim under Georgia product liability law. Specifically, O.C.G.A. § 51-1-11 states that a court may order a manufacturer to pay damages to any person “who suffers injury to his person or property” as the result of merchandise that “was not merchantable and reasonably suited to the use intended.”

Phillips v. Owners Insurance Company

Given that product liability cases are highly fact-specific and by their very nature revolve around a particular item, it is critical to preserve any and all physical evidence from a car accident. It may take several months or years to fully investigate the cause of the accident and the potential liability of the numerous manufacturers involved. When evidence is lost or destroyed, it can adversely affect a victim’s case.

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Many Georgia residents take out “umbrella” policies to provide extra insurance protection in the event of an accident. An umbrella policy provides liability coverage above and beyond standard homeowners or automobile insurance. For example, let’s say your auto insurance policy provides $25,000 in coverage for bodily injury. You get into an accident and the other driver sues you for damages. The court awards the driver $100,000, which obviously exceeds your policy limit. At this point, if you have an umbrella policy, which typically provides coverage in the millions of dollars, it would cover the rest of the judgment.

Massey v. Allstate Insurance Company

You can also purchase an umbrella policy for uninsured motorist coverage. This refers to insurance that pays for injuries that you sustain in an accident caused by another driver who either has no insurance or lacks sufficient coverage to pay for your total damages. Georgia law requires all insurers to offer uninsured motorist coverage of at least $25,000 for bodily injury to a single person (or $50,000 for multiple people injured in the same accident). The customer has the option of rejecting UM coverage, but it must be offered.

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Earlier this year, the U.S. Department of Transportation launched a $7 million advertising campaign to warn drivers about the dangers of railroad crossings. The DOT noted that while the total number of railroad incidents have been in decline over the past decade, a person or vehicle is still hit by a train roughly every three hours. In 2016, there were 232 reported deaths due to railroad crossing accidents.

Liberty Surplus Insurance Corp. v. Norfolk Southern Railway Co.

Recently the U.S. 11th Circuit Court of Appeals in Atlanta dealt with a personal injury lawsuit arising from a 2011 railroad crossing accident. The victim was severely injured when a train struck her. She claimed she could not see te approaching train due to “overgrown and improperly maintained vegetation at the railroad crossing.”

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Most car accident lawsuits in Georgia are handled by the negligent driver’s insurance company. If an insurer refuses to settle a personal injury claim “in bad faith,” said insurer may be liable for any judgment against the insured in excess of the policy’s normal limits. In other words, the insurance company may not place its own interests ahead of those of its policyholders by dragging its feet to avoid settling an apparently valid personal injury claim.

Linthicum v. Mendakota Insurance Company

But an insurance company’s obligation is only to act reasonably when attempting to negotiate a settlement. It is not necessarily liable just because no settlement is reached. A recent decision by a federal judge in Savannah illustrates this point.

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Insurance policies frequently cover any damages incurred due to a car accident. But it is not unusual in Georgia for insurance companies to disclaim or otherwise reject coverage if the insured does not strictly comply with all terms of the policy. In some cases, insurance companies may end up fighting among themselves over who is liable for any damages arising from a personal injury claim.

Selective Insurance Company of America v. Russell

A federal judge in Gainesville recently addressed such a case. This is one of two lawsuits arising from a 2011 car accident. Two vehicles collided, resulting in the death of a passenger in one of the cars. The driver of Car A and the estate of the deceased passenger sued the driver of Car B in Georgia state court.

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Dealing with insurance companies is often the first legal issue that needs to be managed following a car accident. While many cases are amicably resolved with insurers without the need for litigation, accident victims always need to tread carefully lest they inadvertently sign away their legal rights. As a recent Georgia Court of Appeals decision illustrates, when you propose to settle a case you must be prepared to live with the consequences.

Partain v. Pitts

The plaintiff and defendant in this case were drivers involved in a car accident. The plaintiff sued the defendant, alleging the latter’s negligence caused the accident and the plaintiff’s resulting injuries. Four days after filing suit, the plaintiff’s attorney sent a settlement letter to the claims adjuster for the defendant’s car insurance carrier. The letter said the plaintiff would agree to sign a limited liability release in exchange for $50,000, which was the coverage limit of the defendant’s insurance policy. The letter further said the offer would only remain good for two weeks, and the plaintiff’s attorney had to receive a check by the deadline, otherwise the settlement offer was rescinded.

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Uninsured motorist coverage extends the protection of your own automobile insurance to accidents caused by another party who lacks sufficient insurance to compensate you for any injuries. For example, let’s say a drunk driver hits you. You subsequently sue the driver and win $1,000,000 in damages from the jury. But the driver only has $25,000 in insurance and lacks any other assets to pay the remainder of the judgment. In this situation you could seek compensation under your own policy’s uninsured motorist coverage.

Coker v. American Guarantee and Liability Insurance Company

The above example seems relatively straightforward. But what happens when there are multiple insurers who may be liable for the same accident? A federal appeals court in Atlanta recently addressed such a case.

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Georgia law requires all drivers to carry auto insurance. The law sets certain minimum requirements for coverage. For example, a policy must include provide at least $25,000 in coverage for “bodily injury” to one person, or $50,000 to cover multiple persons injured in the same accident. Remember, these are only minimum requirements, and many drivers choose to purchase insurance policies with higher coverage limits.

State Farm Mutual Insurance Co. v. Marshall

But insurance does not cover an accident just because your car may be involved in some way. A recent Georgia case illustrates this point. The case actually began as a dispute over the ownership of a car. In 2010, a boyfriend purchased a car for his girlfriend. She had poor credit and needed him to register the car in his name so she could obtain a loan to finance the purchase. Although the girlfriend subsequently made the loan payments, the vehicle remained legally titled in the name of the boyfriend.