Following an $8.1 million judgment against Nationwide Insurance, the Georgia Chamber of Commerce has weighed in on the side of the insurer in asking the U.S. Court of Appeals for the Eleventh Circuit to rein in what it describes as a rising tide of “set-up cases” engineered by lawyers using time-limited policy demands to gin up “bad faith” judgment claims against insurers.
Chamber lawyers and Bryan Cave partners Adwoa Seymour and William Custer argued in an August 23 motion to file an amicus brief with the court that the case is a prime example of a “recent epidemic of bad-faith litigation in Georgia” stemming from the abuse of so-called Holt letters to allow essentially any response for an insured’s policy limits other than immediate acceptance to be deemed negligent and used to support a bad-faith failure to settle.
The chamber’s brief claims that the recurring “bad-faith-failure-to-settle” actions actually incentivize parties not to settle and lead to insurers being held liable for judgments far in excess of their insureds’ policy limits, raising rates for everyone and making policy limits “effectively unenforceable.”
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Greg Land
Greg Land covers topics including verdicts and settlements and insurance-related litigation for the Daily Report in Atlanta.
