What Constitutes a Counteroffer by an Insurance Company in a Car-Motorcycle Accident Settlement?

We’ve negotiated cases with almost every insurance company out there. (We’ve also beaten many of them in court.) One common thing we see in every case is whether we should settle or go to trial. Settling doesn’t just involve accepting the money in exchange for a release; it includes numerous terms that need to be honored. If we send a settlement offer with certain terms and the insurance company fails to honor any of those terms, we do not have a binding agreement.

In a case arising from a motor vehicle accident, the Georgia Court of Appeals recently said that the trial court didn’t err in ruling that the insurance company’s response letter asking for another person to be included in the release constituted a counteroffer, not a request for clarification of the settlement offer and that no valid contract had therefore been formed between the parties.


In the early evening hours of January 12, 2020, the plaintiff was riding his motorcycle along E.E. Butler Parkway near Gainesville, Georgia. As he was traveling straight along the parkway, he stopped at a red traffic light. The defendant, who was traveling along the parkway from the opposite direction, approached the same traffic light as the plaintiff and moved into the left turn lane. When the light turned green, the plaintiff proceeded through the intersection and was struck by the defendant as she attempted to make a left turn. The impact of the collision threw the plaintiff from his motorcycle onto the pavement, and he sustained injuries to his pelvis, bladder, ribs, lungs, and stomach.

At the time of the accident, Progressive was the insurance provider for the automobile driver’s husband, who was the named insured under the policy while the defendant was listed as a driver under the policy. The plaintiff sent a letter to Progressive Insurance, proposing to settle his claims against the company and the defendant.

Progressive then sent a letter to the plaintiff, acknowledging his offer to settle his claims against the defendant and the insurance company. Progressive then stated in the letter that the defendant’s husband was the insured under the policy, and posed the following question to the plaintiff:

“Could you please clarify if the defendant’s husband can also be named on the limited liability release?”

The plaintiff didn’t initially respond to the letter. A month later, Progressive sent the plaintiff a letter “accepting” his offer, along with a check for $25,000 and an affidavit stating that there were no other policies that could provide coverage for the accident. The plaintiff returned the check to Progressive and informed them that it had failed to properly accept his offer because its request to add the husband to the release constituted a counteroffer.

The plaintiff filed a negligence action against the defendant, who filed a motion to enforce the settlement agreement. The defendant argued that a binding settlement agreement was reached between the parties. The trial court denied the motion after a hearing, concluding that Progressive’s response letter to the plaintiff requesting to add the defendant’s husband to the release constituted a counteroffer. The defendant appealed.

The Court of Appeals’ Decision 

The defendant argued that the trial court erred by denying her motion to enforce the settlement agreement because Progressive’s response letter to the plaintiff merely sought clarification of the terms of his offer in accordance with Georgia Statute § 9-11-67.1 and that his offer was unequivocally accepted without variance. The trial court disagreed.

Presiding Judge M. Yvette Miller wrote in her opinion that under Georgia law, an agreement alleged to be in settlement and compromise of a pending lawsuit must meet the same requisites of formation and enforceability as any other contract.

The judge said it’s well settled that an agreement between two parties will happen only when the minds of the parties meet at the same time, upon the same subject matter, and in the same sense. An answer to an offer won’t amount to an acceptance and result in a contract unless it is unconditional and identical with the terms of the offer. In other words, to constitute a contract, the offer must be accepted unequivocally and without variance of any sort.

The failure to agree to even one essential term means there’s no agreement to be enforced.

The Essential Elements of a Settlement Offer

OCGA 9-11-67.1 provides the essential terms that must be present in an offer to settle:

  • The time period within which such offer must be accepted, which shall be not less than 30 days from receipt of the offer;
  • Amount of monetary payment;
  • The party or parties the claimant or claimants will release if such offer is accepted;
  • The type of release, if any, the claimant or claimants will provide to each releasee; and
  • The claims to be released.

The Letter was a Counteroffer

Here, the plaintiff sent a letter to Progressive offering to settle his claims against the defendant and Progressive for $25,000 in exchange for a limited liability release. In the offer letter, the plaintiff twice identified the only two parties against which he wished to settle his claims: the defendant and Progressive. Specifically, he stated that he wanted to resolve his personal injury claim against the defendant and Progressive and that in exchange for the policy limit, he would release all claims he had against the defendant and Progressive. The insurance company then sent the plaintiff a response letter expressly acknowledging the terms of the plaintiff’s offer and his offer to release the defendant and Progressive.

Progressive Insurance didn’t pose any questions to the plaintiff about the existing terms in his offer letter or the specific parties he offered to release, nor did it give any indication that it would unequivocally accept the plaintiff’s offer. Instead, Progressive asked him if an additional party that the plaintiff didn’t previously offer to release could “also be named on the limited liability release[.]”

Therefore, the Court of Appeals concluded that Progressive’s response letter wasn’t an attempt to seek clarification, but it instead constituted a counteroffer. The offer letter was “plain and unambiguous” with respect to the two parties the plaintiff was willing to release. Progressive’s response letter, however, was not identical with the terms of the plaintiff’s offer, nor was it unvarying from the precise terms of his offer. It questioned whether an additional party could be added to the release. That showed that Progressive wanted to negotiate over the inclusion of the defendant’s husband in the release. As a result, it constituted a counteroffer. The fact that Progressive used the word “clarify” in its response letter was of no significance.

The Court of Appeals affirmed the trial court’s order denying the defendant’s motion to enforce the settlement agreement. Bennett v. Novas, 2022 Ga. App. LEXIS 310 (Ga. App. June 17, 2022).

Questions About a Settlement Offer from an Insurance Company?

Contact an experienced personal injury lawyer whom Atlanta residents trust every day. Please contact Tobin Injury Law. Our law firm has worked with accident victims all across the state and we have negotiated millions of dollars in settlement offers from almost every insurance company out there.

We offer free confidential consultations to anyone who calls. Call our Atlanta personal injury lawyer at Tobin Injury Law at 404-JUSTICE (404-587-8423) or use our online contact form.