Georgia Bad Faith Insurance Practices Demand Letter

If a Georgia insurance company has refused to pay a valid claim, delayed payment without justification, or otherwise mishandled your loss, state law gives you a powerful tool: a formal bad faith demand letter. Under O.C.G.A. § 33-4-6, you must give the insurer written notice and 60 days to pay before you can sue for bad faith penalties. Sending a properly drafted demand letter is not optional in Georgia—it is a statutory prerequisite to recovering the 50% penalty and attorney's fees the law allows. A clear, well-documented letter often pressures insurers to pay promptly rather than risk litigation. This page explains how Georgia's bad faith law works and how to use a demand letter to enforce it.

Georgia regulates insurer conduct on first-party claims primarily through O.C.G.A. § 33-4-6, the state's bad faith statute. The law applies when an insurer refuses to pay a valid claim within 60 days after the insured makes a proper demand, and that refusal is found to be 'in bad faith.' Bad faith generally means the insurer had no reasonable or probable cause for denying or delaying the claim. Georgia courts have interpreted this to include flat denials without investigation, lowball offers unsupported by evidence, ignoring policy terms, and unreasonable delays.

If a jury or court finds bad faith, the insurer faces three distinct consequences: (1) payment of the underlying claim, (2) a penalty of up to 50% of the insurer's liability or $5,000—whichever is greater, and (3) all reasonable attorney's fees incurred in pursuing the claim. These remedies are in addition to, not instead of, the policy benefits owed.

For third-party liability claims (where another driver's insurer fails to settle within policy limits), Georgia recognizes a separate common-law bad faith doctrine under Holt v. State Farm and related cases, which can expose the insurer to the full amount of an excess judgment. Different rules apply to uninsured motorist claims under O.C.G.A. § 33-7-11(j), which carries similar penalties.

Importantly, the 60-day demand period must be strict and unambiguous. Courts have dismissed bad faith claims where the demand letter was vague, premature, or failed to identify the policy, the claim, or the amount sought. The insurer must receive a clear opportunity to cure before liability attaches. This makes the demand letter the single most important document in any Georgia bad faith case.

An effective Georgia bad faith demand letter does three things at once: it satisfies the statutory notice requirement, documents the insurer's unreasonable conduct, and creates leverage for settlement. Start by clearly identifying the policy number, claim number, date of loss, and the exact dollar amount you are demanding. Vague references to 'all damages' will not start the 60-day clock.

Next, walk through the facts showing the claim is covered and that you have complied with all policy conditions—proof of loss, examinations under oath, document requests, and cooperation. Attach supporting evidence: estimates, medical bills, photographs, repair invoices, and any prior correspondence. The goal is to leave the adjuster no room to claim the file was incomplete.

Then, explicitly cite O.C.G.A. § 33-4-6 and state that the letter constitutes formal demand under the statute. Make clear that if payment is not received within 60 days, you intend to file suit seeking the full claim amount, the 50% statutory penalty (or $5,000, whichever is greater), and attorney's fees. For UM claims, cite § 33-7-11(j) instead.

Keep the tone professional, not emotional. Georgia juries and judges respond better to organized, evidence-based demands than to angry rhetoric. Send the letter via certified mail, return receipt requested, and keep proof of delivery—this is your evidence that the 60-day clock started. Calendar the deadline and follow up in writing if the insurer requests additional information, so any further delay is clearly documented as unreasonable.

Bad faith claims in Georgia are typically filed in state or superior court because damages often exceed magistrate court's $15,000 limit. Magistrate (small claims) court can hear straightforward policy benefit disputes under $15,000 but cannot award equitable relief. Filing fees in superior court generally range from $200 to $230, varying by county. Georgia's general statute of limitations for written contract claims is six years from breach (O.C.G.A. § 9-3-24), but tort-based bad faith theories may have shorter periods. The 60-day demand period must elapse before suit is filed—filing prematurely is grounds for dismissal of the bad faith count. Service must comply with O.C.G.A. § 9-11-4. Insurers regulated in Georgia must be served through the Commissioner of Insurance for out-of-state carriers.