The Supreme Court of Georgia has rejected a lower court’s use of an insurance “exhaustion” rule to decide whether a motorist settled a liability claim after reporting more than $150,000 in crash-related medical expenses. In a Sept. 22 ruling, the justices vacated the Court of Appeals’ judgment and sent the dispute back for reconsideration.
The case, Cravens v. Slaughter, arose after Ashleigh Slaughter rear-ended a vehicle driven by Jack Cravens while operating her employer’s car. Cravens said he injured his shoulder and incurred medical costs above $150,000. He sought the at-fault vehicle’s $50,000 liability limit from Auto-Owners Insurance Co. and separately demanded the $100,000 limit of his own uninsured/underinsured motorist coverage, also issued by Auto-Owners. The insurer accepted the UM demand, but Cravens’s lawyer maintained that the liability claim had not settled, according to the court’s case record.
Slaughter and the other defendants later asked a trial court to enforce what they viewed as a liability settlement. The trial court refused. Georgia’s Court of Appeals reversed, reasoning that Cravens could obtain UM benefits only after exhausting the liability coverage and that his UM settlement therefore showed the liability claim had already settled. The appellate court described the UM settlement as especially important because the same company handled both policies, its 2025 opinion shows.
The state Supreme Court said that reasoning stretched earlier cases beyond their setting. Those cases addressed whether an insured could recover UM benefits through litigation before exhausting available liability coverage. They did not decide whether an insured and a carrier could settle a UM claim before resolution of the liability claim. The justices found no statute or prior decision making exhaustion a prerequisite to that kind of settlement and said the lower court should not have treated the rule as dispositive.
Georgia law generally requires auto policies to include UM protection unless the insured rejects it in writing. The state statute defines how stacked and non-stacked coverage operate when an at-fault driver’s insurance is insufficient. But the Supreme Court said those provisions do not dictate the timing or terms of an offer to settle a UM claim. It also emphasized that insurance policies remain contracts and may contain lawful conditions governing when payment is owed.
The decision is narrow. It does not decide whether Cravens and the defendants actually formed a liability settlement, and it does not overturn precedent requiring exhaustion before a plaintiff recovers UM benefits in a lawsuit. The court expressly left those broader questions for another case. On remand, the Court of Appeals must reconsider the parties’ communications and conduct without assuming that the UM settlement itself proves the liability claim had settled.
For Georgia drivers, insurers and lawyers, the immediate consequence is procedural: resolving the UM side of a crash claim does not automatically establish that the liability side was resolved first. Courts still must apply ordinary settlement and contract principles to the evidence. All participating justices concurred; Chief Justice Nels Peterson was disqualified.
