Many insurance companies have a well-earned reputation for being difficult to deal with. In our experience, Allstate is among the worst because it often drags out even the simplest of claims for months or even years longer than necessary. Serious negotiations are part of the claims process; however, there is an important line between negotiating in good faith versus bad faith. While many insurance companies walk a fine line between good and bad faith, Allstate has developed a reputation among Georgia lawyers for pushing those boundaries. This is especially true when Allstate’s insured causes a crash.
Duties of Automobile Insurers under Georgia LawGeorgia law imposes important duties on car insurance companies. If a claim is brought against you, most injured claimants will give your insurance company an opportunity to settle the claim within your policy limits. If the injured party has a lawyer, the claim will usually be sent to your insurance company in compliance with the terms of O.C.G.A. § 9-11-67.1. This statute lays out the basic requirements of a pre-suit settlement demand where the injured person’s attorney will give your insurer an opportunity to settle the claim and protect your personal assets. When your insurance company receives an offer of settlement, it must put your interests ahead of its own. “[W]here a person injured by the insured offers to settle for a sum within the policy limits, and the insurer refuses the offer of settlement, the insurer may be liable to the insured to pay the verdict rendered against the insured even though the verdict exceeds the policy limits. The reason for this rule is that the insurer may not gamble with the funds of its insured by refusing to settle within the policy limits.” McCall v. Allstate Ins. Co., 251 Ga. 869, 870 (1984). If an insurance company receives a legitimate settlement offer pursuant to O.C.G.A. § 9-11-67.1 and refuses to pay, you will likely get sued. When the lawsuit results in a verdict and judgment that exceeds your policy limits, you are legally responsible for paying the amount that exceeds your policy limits. Your insurance company will be responsible for paying any amount within the liability limits of your policy. In situations like this, all may not be lost. After a judgment in excess of your policy limits is entered against you, you may be able to bring a claim against your insurance company for the excess amount if your insurer refused to settle for an amount within your policy limits.
Bad Faith Automobile Insurance Claims in GeorgiaGeorgia allows for bad faith claims with multiple types of insurance policies. The most common type of “bad faith” claim is one that is brought after an insurer rejects a time limited offer of settlement that an attorney sends in compliance with O.C.G.A. § 9-11-67.1. O.C.G.A § 9-11-67.1 settlement offers are sent to the insurer of a driver that caused a wreck. When an insurance company fails to use good faith in negotiating car accident claims, it can leave its insured open to substantial financial exposure and mental anguish. The insurer also exposes its insured to protracted litigation, the time and expense of attending depositions, participating in discovery and attending trial, the emotional anguish of reliving the collision and harm caused, and other financial loss such diminished credit ratings. Therefore, Georgia allows an insured to sue his or her own insurance company when it acts in bad faith during settlement negotiations. In order to succeed in a bad faith lawsuit against a liability insurance carrier, the insured will need to prove:
- The insurer failed to give equal consideration to the interests of its insured,
- The insurer failed to accord its insured the same faithful consideration it accords its own interest,
- The insurer refused to settle because of an arbitrary belief that the insured was not liable, or
- The insurer refused to entertain a settlement offer with no regard given the position of its insured.