---
title: O.C.G.A. § 8-2-40. Effect of claimant’s acceptance of settlement; subrogation of insurance.
collection: code
id: 8-2-40
cite_as: O.C.G.A. § 8-2-40 (2025)
canonical_url: https://georgiacommons.org/code/8-2-40
md_url: https://georgiacommons.org/code/8-2-40.md
text_url: https://georgiacommons.org/code/8-2-40/text
source_url: https://www.legis.ga.gov/api/document/docs/default-source/joint-features-document-library/t7-t8-(v5)-2024-pdf.pdf?sfvrsn=6386add7_0#page=897
date: 2025
status: active
corpus_version: 2025-supplement-89aa39ab3c68
license: CC0-1.0
publisher: Georgia Commons, an independent project of Georgia Civic Data. Not the State of Georgia. Not legal advice.
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version: the only printed version
in_force: true
current_through: Including Acts of the 2025 Regular Session of the General Assembly
heading_path: BUILDINGS AND HOUSING / STANDARDS AND REQUIREMENTS FOR CONSTRUCTION AND ALTERATION OF BUILDINGS AND OTHER STRUCTURES / BUILDINGS GENERALLY / RESOLUTION OF CONSTRUCTION DEFECTS
---

# O.C.G.A. § 8-2-40. Effect of claimant’s acceptance of settlement; subrogation of insurance.

(a) If a claimant accepts an offer made in compliance with this part and the contractor fulfills the offer in compliance with this part:

(1) The claimant shall thereafter be barred from bringing an action for the claim described in the notice of claim; and

(2) A contractor’s performance of repairs or payment of money to a claimant made pursuant to this Code section shall not, by itself, create insurance coverage or otherwise affect the mutual rights and obligations of the parties under a contractor’s liability insurance policy or, by itself, be considered a voluntary payment of an otherwise valid insured loss.

(b) An insurer paying a claim under this part shall be subrogated to the rights of the claimant to whom the amounts were paid against the person causing the construction defect, damages, or other reason for payment to the extent that claim payments were made, except that the insurer shall be required to pay any applicable part of costs, expenses, and attorneys’ fees incurred in connection therewith.

## History

Code 1981, § 8-2-40, enacted by Ga. L. 2004, p. 500, § 1; Ga. L. 2005, p. 499, § 1/HB 307; Ga. L. 2006, p. 548, § 1/SB 573.

## Editor's Notes

Ga. L. 2006, p. 548, § 3(c)/SB 573, not codified by the General Assembly, provides that the amendment to this Code section shall only apply with respect to causes of action or claims arising on or after April 28, 2006, and any prior causes of action or claims shall continue to be governed by prior law.