House rebukes Ga. Chamber, passes bill to penalize insurance carriers

[private]Insurance companies that act in “bad faith” when denying a claim from a policyholder would be penalized $25,000 or more under a bill (HB 303) adopted Wednesday by the Georgia House.

The 153-14 vote to pass HB 303 was one of those rare instances when Republican lawmakers defied the wishes of the Georgia Chamber of Commerce and the National Federation of Independent Business (NFIB), who both opposed the bill and warned legislators their vote would be a “scorecard” vote used against them at election time.

“I know some of us are afraid because the Georgia Chamber and NFIB is against it,” said Rep. Dusty Hightower (R-Carrollton), the bill’s sponsor, but he urged his colleagues to pass the bill anyway – which they did.

Hightower said a letter sent to lawmakers by the Chamber that attacked the bill was a “blatant lie,” a charge that other House members also made.

“They’re just flat-out wrong on this,” said Rep. Earl Ehrhart (R-Powder Springs), who votes the Chamber position on most business-oriented legislation.

“I don’t appreciate a letter that is on our desk that contains false statements,” said Rep. Regina Quick (R-Athens).  “This don’t impress me much.”

“I’m here to take exception to the letter – it’s completely incorrect,” said Rep. Mike Jacobs (R-Atlanta).  “This is not what the bill is, it is not.  I hope the members of this body will view the letter with skepticism.”

HB 303 would apply in cases where an insurance company has been found to be acting in “bad faith” for denying payment of a claim from a policyholder.

Hightower said these bad faith denials often happen to blue-collar workers who hold low-end auto insurance policies and suffer damages in a collision with an uninsured motorist.  Insurers will routinely deny the claim, leaving the policyholder “stranded and abandoned,” Hightower said.

The penalty for a bad-faith denial of a claim would be 25 percent of the value of the damages or $25,000, whichever amount is greater.

“This bill is nuclear, and I meant for it to be,” said Hightower, a lawyer.

“I’m not out to get the insurance companies,” he said.  “I’m not out to line my pockets on this bill.  I’m focusing on low-end policies to protect those blue-collar workers.”

Rep. Christian Coomer (R-Cartersville), one of Gov. Nathan Deal’s floor leaders, quoted this biblical admonition in support of HB 303:  “If you don’t listen to the poor when they cry, you’ll cry and won’t be heard.”

© 2015 by The Georgia Report

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Tags: bad faith claims denials , Dusty Hightower , Georgia Chamber of Commerce , insurance companies , Mike Jacobs , NFIB , Regina Quick