What’s Required in a Limited Release to Preserve a Claim?
In 1992, the General Assembly enacted O.C.G.A. § 33-24-41.1. That statute says that a limited release compliant with its requirements preserves a claim for uninsured or underinsured motorist (“UM”) benefits. Among those requirements is language releasing the settling carrier. At issue in a recent case was whether that procedure was superseded by statute where a plaintiff appealed the grant of summary judgment in an action against a defendant so she could pursue uninsured or underinsured motorist (“UM”) benefits under her own insurance policy.
Background
The plaintiff and the defendant were involved in an automobile collision. About two months later, the plaintiff submitted a settlement offer to the defendant’s insurer, seeking $25,000, the limits of the defendant’s insurance policy, in exchange for a release. The insurer agreed to settle the case, and the plaintiff signed the release and deposited the insurer’s check for $25,000. The release provided that the plaintiff released the defendant “from all claims for bodily injuries of the plaintiff resulting from the collision … except to the extent that other insurance coverage is available that covers any claim or claims of the plaintiff against the defendant.”
The release didn’t contain any language releasing the settling carrier.
The plaintiff then filed this action against the defendant to pursue UM benefits from her own insurer. She served the defendant as well as her own insurer.
The defendant moved for summary judgment on the ground that the release the plaintiff signed didn’t comply with O.C.G.A. § 33-24-41.1(b)(1). Gain, that statute states the requirements for a limited release when a motor vehicle accident claim is covered by two or more insurance carriers.
The release the plaintiff signed didn’t comply with the statute, because it didn’t “release the settling carrier from all liability from any claims of the claimant … based on injuries to such claimant . …”
At trial, the defendant argued that because the release didn’t comply with the requirements of O.C.G.A. § 33-24-41.1, it didn’t preserve the plaintiff’s claim for UM benefits against her own insurer, and so that there was no basis upon which to maintain the lawsuit against him. The trial court granted the defendant’s motion, and the plaintiff appealed.
UM Coverage and O.C.G.A. § 33-24-41.1
Presiding Judge Christopher J. McFadden of the Georgia Court of Appeals wrote that prior to the enactment of O.C.G.A. § 33-24-41.1, Georgia courts had interpreted the Uninsured Motorist Act to require, as a condition precedent to a suit against the insurance carrier, that the insured first sue and recover a judgment against the uninsured motorist, whether known or unknown. In other words, a UM carrier was entitled to insist on a judgment in excess of the liability policy limits before fixing coverage under its policy.
The insurer could waive the condition precedent of insisting on a judgment. So a claimant could maintain an action against his or her own UM insurer after settling with the tortfeasor’s insurer if the UM insurer agreed.
In 1992, the legislature enacted O.C.G.A. § 33-24-41.1 to make meaningful the ability of a claimant to settle with the tortfeasor’s insurance carrier while preserving his UM claim. Subsection (c) expressly provides that UM policies can’t require permission of the UM carrier before a claimant settles with a liability carrier. The limited release provisions of O.C.G.A. § 33-24-41.1 were enacted to provide a statutory framework for a claimant injured in an automobile accident to settle with the tortfeasor’s liability insurance carrier for the liability coverage limit while preserving the claimant’s pending claim for underinsured motorist benefits against the claimant’s own insurance carrier.
Accordingly, now a plaintiff may pursue his UM claim if he settles for the limits of the policy as stated in the policy and executes a limited release in accordance with O.C.G.A. § 33-24-41.1. Both of these requirements must be fulfilled before a plaintiff can pursue his UM claims, the judge wrote. In Georgia, a claimant who settles with a tortfeasor must execute a limited release pursuant to O.C.G.A. § 33-24-41.1 to preserve the claimant’s pending claim for UM motorist benefits against his or her own insurance carrier.
Here, the plaintiff didn’t dispute that her release didn’t comply with O.C.G.A. § 33-24-41.1. The Georgia Supreme Court has held that to preserve a UM claim, a plaintiff must both settle for the limits of the tortfeasor’s insurance policy and execute a limited release in accordance with O.C.G.A. § 33-24-41.1. Here, the plaintiff’s release didn’t comply with O.C.G.A. § 33-24-41.1, so the she didn’t preserve her claim for UM benefits. As a result, the judgment was affirmed. Barker v. Muschett, A25A0583, 2025 Ga. App. LEXIS 226, 2025 LX 151100, 2025 WL 1553002 (Ga. App. June 2, 2025).
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