Early Win for Insurer client: UM Bad-Faith Filing Withdrawn Overnight

Kershaw Law LLC recently obtained a swift result for a client in a uninsured/underinsured motorist (UM/UIM) case filed in Georgia state court on a Tennessee auto policy. After the firm sent a formal demand letter explaining why the standalone suit against the carrier was premature — and why a related statutory “bad faith” penalty claim could not stand on that posture — plaintiff’s counsel voluntarily dismissed the case the next day.

Results like this matter because UM/UIM litigation is often filed against the carrier before the legal predicates for coverage are in place. A fast, well-supported demand can end an unsupported suit without months of motion practice.

How UM “bad faith” claims usually work (and where they fail early)

UM/UIM coverage is not ordinary third-party liability insurance. In broad strokes, the carrier’s obligation is tied to the insured’s right to recover from an uninsured or underinsured at-fault driver. When the governing law is Tennessee, the UM/UIM carrier is typically brought into the case against the tortfeasor — not sued alone as if the policy were already in pay status. A freestanding complaint against the carrier, with no judgment or qualifying failure-of-service path alleged, is often subject to dismissal as premature.

Statutory bad-faith penalties ride on top of a viable claim for benefits. Tennessee’s penalty statute, Tenn. Code Ann. § 56-7-105, cannot be used to turn every coverage dispute into extracontractual exposure. If the underlying UM/UIM claim is not yet ripe — or if the statute does not reach the coverage at issue — the penalty claim usually falls with it. Georgia has its own fee and sanctions tools for baseless filings; the point for insureds and carriers alike is the same: bad faith is about refusal to pay a claim that is actually owed, not about filing first and sorting prematurity later.

When a UM/UIM suit skips those steps, a focused demand letter that walks plaintiff’s counsel through prematurity, choice-of-law, and the limits of statutory penalties can produce the right outcome quickly — including a next-day voluntary dismissal.