In Georgia, the Uninsured Motorist bad faith laws have no bite and as a result the insurers can behave without fear of repercussions for low-balling a case. This past week Geico insurance responded to a policy limits demand we sent on their own insured’s Uninsured Motorist Insurance by claiming the victim was doing just fine despite $69,000 in medical bills and year long recovery.
In this case, it was a head on collision that was clearly caused by the other driver. The victim sustained an AC separation, severe abdominal hematomas, blood clots and spinal sprains to all regions. She spent several days in the hospital and then underwent months of physical therapy. She has now been diagnosed with chronic shoulder pain that will never go away.
The driver who hit her had a $50,000 policy and that was paid out early on. The victim had a $100,000.00 Uninsured Motorist policy with Geico which is supposed to provide the next level of coverage. We sent a demand for the full amount of the policy limits because it is clear that a jury would award in excess of $150,000 for a victim with over $69,000 in bills and a chronic shoulder injury.
Instead we received a letter from Geico offering to settle for $50,000.00. In other words, Geico has adjusted the claim and thinks a jury will only award $100,000 on a victim with almost $70,000 in medical bills alone. I spoke with the adjuster and she cheerily told me that the victim had healed up just fine. I asked her when the last time she saw a verdict come in with a pain and suffering award at $30,000 with $69,000 in medicals and she had no response.
Therein lies the problem. Lazy TV lawyers have settled their cases for pennies on the dollars for years so Uninsured Motorist carriers make these foolish low ball offers. It is not until a year into litigation when the depositions are finished that the insurer begins to realize that the case was always worth more than the policy limits.
Why do they wait so long? Because there is no downside! The insurer gets to sit on their $50,000 and continue to invest it in the stock market to make profit while the victim is forced to go through the litigation process. If the victim’s lawyer is correct and the verdict comes back at say $250,000, then the most the uninsured motorist carrier can be responsible for is 25% of their policy or $25,000.00 plus attorneys fees. That is only obtainable IF the lawyer can show the court that the insurer failed to make the offer for no good reason.
Under OCGA 33-7-11 the victim needs to prove that either the UM insurer refused to pay because of a frivolous and unfounded denial of liability or there was no reasonable ground for them to deny it. In other words, you have to prove to the jury that there was no basis whatsoever to refuse to pay the limits.
What the victim is left with is an insurer that can low ball the value with impunity and that is a broken system.