Aug. 31, 2016—The Georgia Chamber of Commerce has sided with Nationwide Insurance over an $8 million bad faith judgment, according to a story from the Daily Report.
The Georgia Chamber is asking the Eleventh Circuit Court of Appeals to weigh in, saying there is a rising number of “set-up cases” where lawyers take advantage of time-limited policies to win bad faith claims against insurers.
The chamber claims that these cases are setting a precedent for “bad-faith-failure-to-settle” cases, where policyholders have an incentive not to settle since these cases demonstrate that anything other than immediate acceptance could be deemed “bad-faith” and insurers are held liable for judgments far exceeding the policy limit.
The case stems from an accident in 2005 in which a drunk driver killed a Georgia woman. The woman’s husband and mother sought the driver’s policy limit of $100,000. Nationwide rejected the offer saying it would only pay if the family supplied a general release under which they would have to repay the insurer if any other claims were made related to medical liens. No agreement was met and the woman’s husband and mother sued Nationwide for wrongful death. The court ruled that Nationwide had acted in bad faith and awarded $8.1 million.
