GA Code § 33-7-15 (2021)
2021 Georgia Code|Title 33 - Insurance|Chapter 7 - Kinds of Insurance; Limits of Risks; Reinsurance|§ 33-7-15. Cooperation by Insured With Insurer in Defense of Action or Threatened Action Under Policy

  No motor vehicle liability insurance policy covering a motor vehicle principally garaged or principally used in this state shall be issued, delivered or issued for delivery, or renewed in this state unless such policy contains provisions or has an endorsement thereto which specifically requires the insured to send his insurer, as soon as practicable after the receipt thereof, a copy of every summons or other process relating to the coverage under the policy and to cooperate otherwise with the insurer in connection with the defense of any action or threatened action covered under the policy.   Noncompliance by the insured with this required provision or endorsement shall constitute a breach of the insurance contract which, if prejudicial to the insurer, shall relieve the insurer of its obligation to defend its insureds under the policy and of any liability to pay any judgment or other sum on behalf of its insureds.   Subsections (a) and (b) of this Code section shall not operate to deny coverage for failure to send a copy of a summons or other process relating to policy coverage if such documents are sent by a third party to the insurer or to the insurer's agent by certified mail or statutory overnight delivery within ten days of the filing of such documents with the clerk of the court. If the name of the insurer or the insurer's agent is unknown, the third party shall have a period of 30 days from the date the insurer or agent becomes known in which to send these required documents. Such documents must be sent to the insurer or agent at least 30 days prior to the entry of any judgment against the insured.    (b.1)In the event the insurer denies coverage and it is determined by declaratory judgment or other civil process that there is in fact coverage, the insurer shall be liable to the insured for legal cost and attorney's fees as may be awarded by the court.    (Code 1933, § 56-414, enacted by Ga. L. 1982, p. 1624, § 1; Code 1981, §33-7-15, enacted by Ga. L. 1982, p. 1624, § 3; Ga. L. 1983, p. 3, § 24; Ga. L. 1984, p. 22, § 33; Ga. L. 2000, p. 1589, § 3.)   Editor's notes.   - Ga. L. 2000, p. 1589, § 16, not codified by the General Assembly, provided that the amendment to this Code section by Ga. L. 2000, p. 1589, § 3, was applicable with respect to notices delivered on or after July 1, 2000.   Law reviews.   - For survey article on insurance, see 34 Mercer L. Rev. 177 (1982).   JUDICIAL DECISIONS   Applicability.    - O.C.G.A. § 33-7-15 does not apply to lack of notice of accident. Ginn v. State Farm Mut. Auto. Ins. Co., 196 Ga. App. 640, 396 S.E.2d 582 (1990) (questioning holding of Rucker v. Allstate Ins. Co., 194 Ga. App. 407, 390 S.E.2d 642 (1990), to the contrary).    Because O.C.G.A. § 33-7-15(c) was limited to motor vehicle liability insurance and had no effect on the notice received by an insurance company in an action concerning a general liability policy. Holbrook-Myers Co. v. Transp. Ins. Co., 354 F. Supp. 2d 1349 (N.D. Ga. Jan. 7, 2005).   Burden of proof of reasonableness of delay and prejudice.   - Lack of timely notice to the insurer of lawsuits may relieve the insurer of its duty to defend and pay if the delay is unreasonable and the insurer is prejudiced by the delay. The insurer bears the burden of showing both unreasonable delay and prejudice. State Farm Mut. Auto. Ins. Co. v. Stanley, 773 F. Supp. 1539 (S.D. Ga. 1991), rev'd on other grounds, 966 F.2d 628 (11th Cir. 1992).   Exculpatory clause valid where insured failed to notify company of claim.    - Policy provision excusing insurance company from liability for insured's failure to notify insurance company of a claim or suit against insured constituted a valid defense for the company to a judgment against the insured. Berryhill v. State Farm Fire & Cas. Co., 174 Ga. App. 97, 329 S.E.2d 189 (1985).    Notice received from named insured was sufficient, even though he had sold the vehicle to the person who was driving it at the time of the accident but had retained possession of the title certificate as security for the balance owing on the purchase price, and the policy had not yet expired. Mahone v. State Farm Mut. Auto. Ins. Co., 188 Ga. App. 664, 373 S.E.2d 809, cert. denied, 188 Ga. App. 912, 373 S.E.2d 809 (1988).   Third party notice.    - The notice requirement contemplated by O.C.G.A. § 33-7-15 is satisfied if the insurer receives notice of the suit either from an insured or from a third party. Georgia Farm Bureau Mut. Ins. Co. v. Martin, 209 Ga. App. 237, 433 S.E.2d 315 (1993), rev'd on other grounds, 264 Ga. 347, 444 S.E.2d 739 (1994).    Third party's failure to certify her notice to the insurer was not dispositive on the issue of whether notice of the pending suit was, in fact, given within ten days of filing the claim. Weekes v. Nationwide Gen. Ins. Co., 232 Ga. App. 144, 500 S.E.2d 620 (1998).    Unfiled, unstamped, and unverified copy of complaint that counsel for motorist and passenger sent to insurance company was not a summons "or other process" pursuant to O.C.G.A. § 33-7-15(c) sufficient to inform the insurance company of a third party action involving its insured, and thus, did not trigger the insurance company's duties to defend or pay. Peachtree Cas. Ins. Co. v. Bhalock, 252 Ga. App. 328, 556 S.E.2d 218 (2001).    When an injured party sued the insurer of a motorist against whom the injured party obtained a judgment, both to collect on the judgment and to assert a claim, as assignee of the motorist, for bad faith failure to settle, the insurer was not entitled to summary judgment because, even though the motorist did not provide the insurer with notice of the claim, the injured party provided the insurer with sufficient notice, under O.C.G.A. § 33-7-15(c), when it provided the insurer a copy of the complaint, with a court clerk's notation of the case number and the date on which the complaint was filed, and the insurer did not show that the injured party's failure to provide the insurer with a copy of the summons deprived it of the ability to timely and adequately investigate the claim. Canal Indem. Co. v. Greene, 265 Ga. App. 67, 593 S.E.2d 41 (2003).   Insufficient notice.    - Where the information received by the insurer, through various requests for production of documents and other discovery requests barren of a copy of the summons or complaint, did not inform it of even the most basic facts concerning the accident, notice was clearly inadequate. Chadbrooke Ins. Co. v. Fowler, 206 Ga. App. 778, 426 S.E.2d 578 (1992).   Notice requirement not negated.    - O.C.G.A. § 33-7-15 does not negate the requirement that an in personam judgment must be obtained against the insured tortfeasor before the insurer will be obligated to pay it. Southeastern Sec. Ins. Co. v. Lowe, 242 Ga. App. 535, 530 S.E.2d 231 (2000).   Default judgment entered although no notice to insurer.    - The provisions of O.C.G.A. § 33-7-15 do not apply to relieve defendant of its liability when a default judgment was entered against the defendant, despite not being notified of the action by either the insured or any third party. Progressive Cas. Ins. Co. v. Bryant, 205 Ga. App. 164, 421 S.E.2d 329 (1992).   Attorney's fees.    - Where an insured's motor vehicle liability insurer entered a defense on the insured's behalf pursuant to a reservation of rights and then filed a declaratory judgment action seeking a ruling that no coverage existed under the policy, and the plaintiff 's uninsured motorist carrier undertook the insurer's defense in the declaratory judgment action and ultimately obtained a ruling that the insured was covered under the policy, the uninsured motorist carrier may not recover its legal costs and attorney fees expended in defending the insured in the declaratory judgment action. Hall v. Canal Ins. Co., 195 Ga. App. 16, 392 S.E.2d 340 (1990).    Recovery of attorney fees under paragraph (b.1) of O.C.G.A. § 33-7-15 is limited to those situations involving non-cooperation by an insured with the insured's insurance company. Gibson v. Southern Gen. Ins. Co., 199 Ga. App. 776, 406 S.E.2d 121 (1991); Standard Guar. Ins. Co. v. Hulsey, 204 Ga. App. 508, 420 S.E.2d 54 (1992).    Since the instant declaratory judgment action was not predicated upon insured's failure to cooperate with the insurance company, a recovery of attorney's fees would not be authorized. Standard Guar. Ins. Co. v. Hulsey, 204 Ga. App. 508, 420 S.E.2d 54 (1992).    Trial court did not err in denying an insured's motion for attorney fees under O.C.G.A. § 33-7-15(b.1) as the insured could have requested attorney fees under § 33-7-15(b.1) at the time the insured sought O.C.G.A. § 13-6-11 attorney fees below; thus, the request for § 33-7-15(b.1) fees was barred by the doctrine of res judicata. Ponse v. Atlanta Cas. Co., 270 Ga. App. 122, 605 S.E.2d 826 (2004).   Nonprejudicial failure to comply with notice provisions.    - Insured's failure to comply with the notice provisions of a policy of automobile insurance issued pursuant to Georgia's assigned risk plan would not operate to defeat recourse to the policy by a third party, where the insurer received prompt and adequate notice of the pendency of litigation, and there was no suggestion that its ability to defend had been prejudiced in any way by the failure of the insured to provide it with prior notice of an accident. Starnes v. Cotton States Mut. Ins. Co., 194 Ga. App. 320, 390 S.E.2d 419, aff'd, 260 Ga. 235, 392 S.E.2d 3 (1990).   Insurer failed to carry its burden of proving that insured's actions in failing to notify insurer of a pending suit sufficiently prejudiced insurer's ability to defend insured so as to support a summary judgment order relieving insurer of its obligation to defend insured. To establish prejudice the insurer must show some deficiency in the investigation or defense undertaken prior to its notification of the suit, as well as evidence as to what the insurer would have done differently to prevent the prejudice which it alleges to have suffered. State Farm Mut. Auto. Ins. Co. v. Stanley, 966 F.2d 628 (11th Cir. 1992).   No relief from liability for bad faith.    - When an insurer has no notice of a lawsuit against its insured, O.C.G.A. § 33-7-15 and a virtually identical insuring provision do not relieve the insurer of liability from a follow-on suit for bad faith failure to settle and, thus, the insured was not relieved of liability for the bad faith or negligent failure-to-settle claim brought against it. The driver's breach of a condition precedent to coverage under the contract of insurance was not an intervening act sufficient to break the causal chain between the insurer's unreasonable rejection of a settlement demand and the excess default judgment against the driver. GEICO Indem. Co. v. Whiteside, Ga. , S.E.2d (Apr. 19, 2021).   No per se material prejudice.   - There is no per se rule that if an insured, who was involved in the underlying occurrence of the litigation, dies prior to the insurer's receipt of notice of suit, then the insurer is considered materially prejudiced, warranting reversal of district courts grant of insurer's motion for summary judgment. State Farm Mut. Auto. Ins. Co. v. Stanley, 773 F. Supp. 1539 (S.D. Ga. 1991), rev'd on other grounds, 966 F.2d 628 (11th Cir. 1992).   Evidence sufficient to carry insurer's burden of showing prejudice.    - The insurer's introduction of sworn testimony establishing that the insurer received no notification of a suit brought against its insured until after final judgment had been entered in a default situation is sufficient to carry the insurer's burden of showing prejudice under subsection (b) so as to relieve the insurer of its obligations under the policy to defend the suit and pay any judgment entered against its insured. Champion v. Southern Gen. Ins. Co., 198 Ga. App. 129, 401 S.E.2d 36 (1990), cert. denied, 198 Ga. App. 897, 401 S.E.2d 36 (1991).   Failure to cooperate.    - When an injured party sued the insurer of the motorist against whom the injured party obtained a judgment, the insurer was not entitled to summary judgment based on its argument, under O.C.G.A. § 33-7-15(a), that it was relieved of liability due to its insured's failure to cooperate with it because there were genuine issues of material fact as to whether the insured failed to cooperate. Canal Indem. Co. v. Greene, 265 Ga. App. 67, 593 S.E.2d 41 (2003).    Trial court did not err in entering judgment in favor of an insurer in a couple's action seeking satisfaction of a judgment they recovered against an insured in a personal injury suit because the evidence supported a finding that the insurer reasonably requested the insured's cooperation, that the insured willfully and intentionally failed to cooperate, that the insured's failure to cooperate was prejudicial to the insurer, and that the insured's justification for failing to respond was insufficient. Vaughan v. ACCC Ins. Co., 314 Ga. App. 741, 725 S.E.2d 855 (2012).    Cited in Georgia Mut. Ins. Co. v. Rollins, Inc., 209 Ga. App. 744, 434 S.E.2d 581 (1993); Aetna Cas. & Sur. Co. v. Empire Fire & Marine Ins. Co., 212 Ga. App. 642, 442 S.E.2d 778 (1994); Thomas v. Atlanta Cas. Co., 253 Ga. App. 199, 558 S.E.2d 432 (2001).   RESEARCH REFERENCES   Actions Against Insurer for Bad Faith Failure to Settle Claim, 21 Am. Jur. Trials 229.