Bad Faith Insurance Claims Handling

This article addresses Georgia law and regulation. Rules in other states differ. See other claims and coverage guidance if your state is different.

What is insurance bad faith?

Bad faith occurs when a carrier unreasonably denies or delays a valid claim, or fails to fulfill its contractual duties under your policy. In Georgia, bad faith can trigger penalties of up to 50% of the covered loss plus attorney's fees under O.C.G.A. § 33-4-6.

What are the signs of bad faith handling?

• Denial without citing a specific policy provision
• Repeated requests for documents you've already submitted
• Failure to acknowledge or respond within required timeframes
• Settlement offers significantly below documented loss without explanation
• Misrepresentation of policy terms or coverage
• Failure to conduct a prompt and thorough investigation
• Pressure to accept a quick settlement before full damage is assessed

What should you do if you suspect bad faith?

If your carrier is unreasonably denying or delaying a valid claim, these three steps address it in order of escalation.

1. 1
   Build your documentation

   Compile every interaction, dates, names, what was said or written. This contemporaneous record becomes your evidence file if you escalate or litigate.

2. 2
   File a formal complaint with the Georgia OCI

   The Office of Insurance and Safety Fire Commissioner has regulatory authority over all carriers licensed in Georgia. A formal complaint often prompts corrective action faster than months of direct communications. Visit the Georgia OCI → The Georgia DOI consumer services line is 1-800-656-2298.

3. 3
   Consult a licensed Georgia insurance attorney

   Under O.C.G.A. § 33-4-6, Georgia's bad faith statute allows recovery of the covered loss plus up to a 50% penalty and attorney fees. Many insurance attorneys handle bad faith cases on contingency.

How long do you have to file a bad faith claim?

Georgia's bad faith action under O.C.G.A. § 33-4-6 has specific procedural requirements and time limits. Once you suspect bad faith, act promptly. Consult an attorney before the policy's suit limitation clause expires.

Sources

• O.C.G.A. § 33-4-6: Georgia's statutory bad faith penalty, up to 50 percent of the covered loss plus attorney fees.
• Georgia Office of Commissioner of Insurance and Safety Fire, oci.georgia.gov: consumer complaint process and regulatory authority over licensed carriers.