--- title: HB 220. Insurance; insurer under a liability policy to pay a third party and the senior lienholder under certain circumstances; provide collection: bills id: 2025-2026/hb220 cite_as: HB 220, 2025-2026 Regular Session (Ga.) canonical_url: https://georgiacommons.org/bills/2025-2026/hb220 md_url: https://georgiacommons.org/bills/2025-2026/hb220.md text_url: https://georgiacommons.org/bills/2025-2026/hb220/text source_url: https://www.legis.ga.gov/legislation/69773 date: 2025-02-05 status: introduced corpus_version: bills-2026-09-13 license: Public record of the Georgia General Assembly, via LegiScan; see about.md publisher: Georgia Commons, an independent project of Georgia Civic Data. Not the State of Georgia. Not legal advice. up: https://georgiacommons.org/bills/2025-2026.md previous: https://georgiacommons.org/bills/2025-2026/hb219.md next: https://georgiacommons.org/bills/2025-2026/hb221.md index: https://georgiacommons.org/bills/index.md omitted: votes and history omitted_chars: 129 omitted_url: https://georgiacommons.org/bills/2025-2026/hb220.md?full=1 bill_number: HB 220 session: 2025-2026 Regular Session session_slug: 2025-2026 chamber: House bill_type: bill status_date: 2025-02-03 last_action: House Second Readers sponsors: - Martin Momtahan - Kasey Carpenter - Stan Gunter - Kimberly New text_version: Introduced has_text: true legiscan_url: https://legiscan.com/GA/bill/HB220/2025 upstream_id: 1952960 summaries_model: claude-sonnet-5 topic_tags: - car insurance - auto liability policies - lienholder rights - insurance regulation --- # HB 220. Insurance; insurer under a liability policy to pay a third party and the senior lienholder under certain circumstances; provide ## Text House Bill 220 By: Representatives Momtahan of the 17th, Carpenter of the 4th, Gunter of the 8th, and New of the 40th A BILL TO BE ENTITLED AN ACT To amend Chapter 7 of Title 33 of the Official Code of Georgia Annotated, relating to kinds of insurance, limits of risks, and reinsurance, so as to provide for an insurer under a liability insurance policy to pay a third party and the senior lienholder under certain circumstances; to provide for an effective date and applicability; to provide for related matters; to repeal conflicting laws; and for other purposes. BE IT ENACTED BY THE GENERAL ASSEMBLY OF GEORGIA: SECTION 1. Chapter 7 of Title 33 of the Official Code of Georgia Annotated, relating to kinds of insurance, limits of risks, and reinsurance, is amended in Code Section 33-7-11.1, relating to commencement of liability of insurer to pay benefits to third party on behalf of insured and applicability of the Code section, by revising subsections (c) and (d) as follows: "(c) When making any payment to a third party for damage to an automobile for any loss, the insurer shall pay the third party and the senior lienholder of record, if any, as their interests may appear on the records of ownership and shall have printed on the loss estimate, if prepared directly by the insurer, the following: 'Failure to use the insurance proceeds in accordance with a security agreement between you and a lienholder, if any, may be a violation of Code Section 16-8-4 of the O.C.G.A. If you have any questions, contact your lending institution.' This subsection does not apply if the insurer does not prepare the loss estimate or if the estimate is not prepared in the State of Georgia. (d) The provisions of this Code section shall be applicable to all automobile liability or motor vehicle liability insurance policies that pay benefits to a third party on behalf of an insured for the loss of use and towing and storage costs of such motor vehicle issued, delivered, or renewed in this state on or after January 1, 2009." SECTION 2. This Act shall become effective on July 1, 2025, and shall apply to all liability insurance policies issued, delivered, issued for delivery, or renewed in this state on or after such date. SECTION 3. All laws and parts of laws in conflict with this Act are repealed. ## Summaries written by Georgia Commons The following was written by claude-sonnet-5 from the text above and is not part of the bill. Quote the text, not the summary. House Bill 220 would require car insurance companies, when paying a third party for damage to a vehicle, to also pay the senior lienholder on record if one exists, rather than paying the third party alone. ### Plain-language summary Under current Georgia law (O.C.G.A. § 33-7-11.1), when an insurance company pays a third party for damage to an automobile, it must print a notice on the repair estimate warning that misusing the insurance money instead of paying off a car loan could violate Georgia's theft-by-conversion law. This bill adds a new requirement: the insurer must actually pay both the third party and the senior lienholder of record together, based on how ownership interests appear in the vehicle's records, whenever it pays a third party for damage to an automobile. The change applies only to the payment procedure in subsection (c) of the existing law; the notice language and the rest of the statute stay the same. The bill would take effect July 1, 2025, and would apply to all liability insurance policies issued, delivered, or renewed in Georgia on or after that date. ### What it does - Requires insurers paying a third party for automobile damage to also pay the senior lienholder of record, if one exists, based on ownership records. - Keeps the existing requirement that insurers print a warning notice about misusing insurance proceeds on loss estimates they prepare directly. - Leaves the rest of the underlying law about towing, storage, and loss-of-use payments to third parties unchanged. - Sets a July 1, 2025 effective date applying to all liability insurance policies issued, delivered, or renewed in Georgia on or after that date. ### Who it affects Insurance companies that issue automobile liability policies in Georgia, third parties who receive damage payments from another driver's insurer, and lienholders such as banks or finance companies that hold loans on vehicles involved in accidents. ### Why it matters Lienholders currently risk being left out when an insurer pays a third party directly for car damage, which can leave a loan partially unsecured if the money isn't used for repairs or paid toward the loan. Requiring joint payment helps ensure lenders are paid alongside the third party. ### Key provisions - Section 1 amends O.C.G.A. § 33-7-11.1(c) to require insurers to pay both the third party and the senior lienholder of record, as their interests appear, when compensating for automobile damage. - Section 1 retains the existing requirement to print a statutory warning notice on loss estimates the insurer prepares directly in Georgia. - Section 1 leaves subsection (d) unchanged, keeping the law applicable to liability policies covering loss of use, towing, and storage costs issued on or after January 1, 2009. - Section 2 sets the effective date as July 1, 2025, applying to policies issued, delivered, or renewed on or after that date. - Section 3 repeals any conflicting laws. ## Status - Status: Introduced (2025-02-03) - Last action: House Second Readers (2025-02-05) - Sponsors: Martin Momtahan, Kasey Carpenter, Stan Gunter, Kimberly New - Official page: https://www.legis.ga.gov/legislation/69773 > The history, votes, and amendments (129 characters) are at https://georgiacommons.org/bills/2025-2026/hb220.md?full=1