Insurance Interpleader Actions

If you practice injury law long enough in Georgia as a claimant’s lawyer some insurance company will be faced with too many demands for too little insurance money at some point and you will find yourself on the receiving end of an interpleader action.

The Federal Interpleader Statute can be found at 28 U.S.C. § 1335. Although it has other uses, the statute allows an insurance company to dump its entire policy into the registry of court when it is unsure of which claimant for the funds is most deserving. In this context, it usually happens when there are multiple injured parties and not enough insurance.

It appears that, at least in the Southern District of Georgia, you are entitled to a jury trial on the interpleader issues although as a general practice most parties tend to agree to a bench trial. See The Prudential Insurance Company of America v. Crouch et al

Key things to know, watch out for the short fuse on the time to answer because you can default.

If you fail to answer an interpleader action in Georgia, are you in default and can your client be cut out of the proceeds?

Interpleader defendants can move for default judgments under  Rule 55. See Valley Forge Life Ins. Co. v. Rockmore, No. 7:07-CV-63, 2008 WL 1805450, at
*1-2 (M.D. Ga. Apr. 18, 2008) (granting an interpleader defendant’s motion for default judgment against two defaulting interpleader defendants).

If you find yourself as a defendant in an Interpleader action over life insurance proceeds or with regard to an injury case where there is not enough insurance, be on your toes, get your answer filed timely and find an experienced Savannah car accident attorney.