Regarding "Lawyers hatch deal for bill to limit bad faith cases," Feb. 21: I taught the Insurance Law courses at UGA Law from 2008 to 2011 and since 1999 have had in print for West Publishing a two-volume treatise entitled Excess Liability, which surveys bad faith and excess cases across the country.
Georgia courts pay lip service to the rule of law and then find myriad issues of fact as a means to throw the insurer under the bus. Ordinary folks sitting in a jury box like other ordinary folks. They do not like insurance companies.
So what happens is about 5 percent of the population with clever counsel turn $25,000 policies into millions. Jackpot justice and the excesses of our system result in big recoveries for a few victims and higher insurance rates for the vast majority of people who pay these rates so that a few victims and a few lawyers can reap a million-dollar payday.
O.C.G.A. § 33-4-6 limits the rights of a policyholder to recover on a first party claim against his or her own insurer. If the insurance company messes up, there is a 50 percent penalty and attorney fees. In the wonderful world of "Holt ups," there is no cap on the penalty. A stranger to the insurance policy and a clever lawyer can turn a $25,000 policy into one with no limits.
Our judiciary over and over finds issues of fact in these disputes, and then lets a jury determine punitive damages and attorneys fees. The appellant is almost never the claimant. Georgia is among the handful of worst jurisdictions in the country on bad faith law.
We have a Republican legislature and Republican governor, yet House Bill 336 completely misses the mark, apparently having been drafted by a secret committee including lawyers from the Georgia Trial Lawyers Association. The legislation as drafted is useless without a cap on the penalty.
The cure for Holt miscues is the same cap and penalties allowed under O.C.G.A. § 33-4-6 or one consonant with it.
I urge the General Assembly to re-draft this bill. What you have now will do nothing to curb 20 years of Holt litigation excesses. The courts have done nothing to curb the problem, and this legislation has no teeth.
For the benefit of the 95 percent-plus who pay higher premiums because of Holt economics, I urge you to go back to the drawing board and put into this bill the same penalty provisions found in O.C.G.A. § 33-4-6. Otherwise as the saying goes, you are putting a Band-Aid on a sucking chest wound.
Bob Persons, Atlanta
