Waiver Means Tolling, Not Amnesty: Eleventh Circuit Clarifies Georgia Insurance Law on Suit-Limitation Waivers, “Prompt” Notice, and the Meaning of “Suspension” for Business-Income Coverage

Introduction

This commentary examines the Eleventh Circuit’s unpublished but instructive decision in TransWorld Food Service, LLC v. Nationwide Mutual Insurance Company (No. 24-11121, Aug. 26, 2025), arising from a series of first-party commercial property insurance claims under a Georgia-governed policy. TransWorld, a food supplier operating a refrigerated warehouse, sought coverage for three discrete losses (2016, 2017, 2018) and alleged bad faith after Nationwide denied or limited payment. The district court granted summary judgment to Nationwide. On appeal, a panel consisting of Chief Judge William Pryor and Judges Luck and Brasher affirmed.

Three core legal issues dominate the decision:

How Georgia law treats an insurer’s “waiver” of a contractual suit-limitation period when the insurer continues to adjust and partially pay a claim.
What “prompt notice” requires under Georgia law and whether a nearly four-month delay—while the insured pursues recovery from a third party—can be justified.
Whether “suspension” of operations in a business-income coverage provision requires a total cessation of operations (as opposed to a partial slowdown) to trigger coverage.

The court’s holdings, grounded in Georgia authority and nationwide consensus, supply practical guidance on claims handling, policy compliance, and litigation timing for insureds and insurers alike.

Summary of the Judgment

The Eleventh Circuit affirmed summary judgment for Nationwide on all challenged claims:

2016 Loss (warehouse flood): The policy’s one-year suit limitation was enforceable. Although Nationwide’s continued adjustment and partial payments waived the limitation temporarily, the waiver only tolled the time bar and ended upon Nationwide’s final payment/denial on March 22, 2018. TransWorld’s suit filed July 22, 2019 was untimely.
2017 Loss (cut freon line): TransWorld’s nearly four-month delay in providing notice—while it first pursued recovery from the roofer’s insurer—violated the policy’s “prompt notice” condition precedent. Under Georgia law, such an unjustified delay is unreasonable as a matter of law.
2018 Loss (neighboring unit leak): Business-income coverage requiring “suspension” of operations demands a complete cessation of operations. Because TransWorld continued operating, it was not entitled to business-income benefits.
Bad Faith: The failure of the coverage claims defeated the dependent bad-faith claims.

Detailed Analysis

Key Facts and Procedural Posture

2016 Flood: Water main failure caused extensive damage. Nationwide promptly adjusted and made multiple partial payments (June–Dec 2016) and a final payment on March 22, 2018. Suit filed July 22, 2019.
2017 Freon-Line Cut: Roofers damaged the freezer’s freon supply, spoiling stock and requiring equipment repairs. TransWorld first sought recovery from the roofer’s insurer. After partial third-party payments, TransWorld notified Nationwide on November 2, 2017 (3 months, 23 days post-loss). Nationwide paid for the compressor, not business income.
2018 Neighbor Leak: Water leak ruined frozen goods. TransWorld first notified the landlord’s insurer, which denied the claim. It then turned to Nationwide for food spoilage and business income. Nationwide denied business-income coverage on the ground that operations never fully ceased.
The district court entered summary judgment for Nationwide; the Eleventh Circuit reviewed de novo and affirmed.

Precedents Cited and Their Influence

Contractual limitation and waiver/tolling:
- Thornton v. Georgia Farm Bureau Mut. Ins. Co., 695 S.E.2d 642 (Ga. 2010) – Georgia enforces contractual suit-limitations in insurance policies.
- Auto-Owners Ins. Co. v. Ogden, 569 S.E.2d 833 (Ga. 2002) – An insurer can waive a suit-limitation period through conduct leading the insured to rely on payment promises.
- Looney v. Georgia Farm Bureau Mut. Ins. Co., 233 S.E.2d 248 (Ga. Ct. App. 1977) – The cornerstone for this case. Even when waiver occurs, it tolls the limitation; tolling ceases upon denial/final decision, and the contractual clock resumes running. The Eleventh Circuit adopts Looney’s mechanics to hold TransWorld’s 2016 claim time-barred.
- Other cited Georgia cases – Balboa Life & Casualty, LLC v. Home Builders Fin., Inc., Mikell, Shelter Am. Corp., Universal Sci., Inc. – These focus on whether a waiver occurred, not on the effect of waiver; they do not displace Looney’s tolling rule.
Prompt notice as a condition precedent:
- Plantation Pipe Line Co. v. Stonewall Ins. Co., 780 S.E.2d 501 (Ga. Ct. App. 2015) – Georgia permits policies to make notice a condition precedent to coverage, requiring strict compliance absent justification.
- Lankford v. State Farm Mut. Auto. Ins. Co., 703 S.E.2d 436 (Ga. Ct. App. 2010) – Pursuing another insurer before notifying one’s own is not a valid justification for notice delay; notice must be “as soon as reasonably possible,” not after other avenues are exhausted.
- Bituminous Cas. Corp. v. J.B. Forrest & Sons, Inc., 209 S.E.2d 6 (Ga. Ct. App. 1974) – About four months’ unjustified delay is unreasonable as a matter of law.
- Rucker v. Allstate Ins. Co., 390 S.E.2d 642 (Ga. Ct. App. 1990) and Progressive Mountain Ins. Co. v. Bishop, 790 S.E.2d 91 (Ga. Ct. App. 2016) – The court distinguished these because they involved factual disputes about justification; TransWorld had none.
- Silva v. Liberty Mut. Fire Ins. Co., 808 S.E.2d 886 (Ga. Ct. App. 2017) – Confirms Georgia courts treat “promptly” akin to “as soon as reasonably possible”/“as soon as practicable.”
Business-income “suspension” means total cessation:
- Pomerance v. Berkshire Life Ins. Co. of Am., 654 S.E.2d 638 (Ga. Ct. App. 2007) – Courts look to ordinary dictionary meaning for undefined policy terms.
- Partin v. Georgia Farm Bureau Mut. Ins. Co., 770 S.E.2d 38 (Ga. Ct. App. 2015) – Interpret policies holistically to harmonize provisions; supports construing “suspension” alongside “resumed operations” language.
- SA Palm Beach, LLC v. Certain Underwriters at Lloyd’s London, 32 F.4th 1347 (11th Cir. 2022) – In diversity cases, federal courts predict state law by presuming adoption of the majority rule absent contrary indication.
- Majority-rule decisions across jurisdictions:
  - Forestview The Beautiful, Inc. v. All Nation Ins. Co., 704 N.W.2d 773 (Minn. Ct. App. 2005)
  - Broad Street, LLC v. Gulf Ins. Co., 832 N.Y.S.2d 1 (N.Y. App. Div. 2006)
  - Buxbaum v. Aetna Life & Cas. Co., 126 Cal. Rptr. 2d 682 (Cal. Ct. App. 2002)
  - Home Indem. Co. v. Hyplains Beef, L.C., 893 F. Supp. 987 (D. Kan. 1995), aff’d, 89 F.3d 850 (10th Cir. 1996)
  - Couch on Insurance § 167:11 (3d ed. 2025)
  Collectively, these authorities endorse the proposition that “suspension” ordinarily requires a temporary but complete halt in business operations, not merely a slowdown.
Choice of law:
- Ins. Co. of N. Am. v. Lexow, 937 F.2d 569 (11th Cir. 1991) – Confirms application of Georgia law to the policy.

Legal Reasoning Applied

1) 2016 Loss: Waiver of the One-Year Suit Limitation Only Tolled the Deadline

The policy required any “legal action” to be brought within one year of the physical loss. Georgia enforces such provisions. While Nationwide’s ongoing adjustment and partial payments created a waiver of strict compliance during negotiations, the Eleventh Circuit—relying on Looney—held the effect of such waiver is tolling, not permanent amnesty. Tolling ends when the insurer denies liability or makes a final decision on the claim. Here, Nationwide’s final payment on March 22, 2018 was treated as an effective end to negotiations/denial of further liability, restarting the one-year clock. TransWorld filed suit July 22, 2019—outside that period—rendering the claim untimely.

The court distinguished Georgia cases cited by TransWorld as addressing whether waiver occurred, not the effect of waiver when it does occur. Looney remains the controlling Georgia authority on waiver-effect mechanics.

2) 2017 Loss: Four Months’ Unjustified Delay Is Not “Prompt” Notice as a Matter of Law

The policy’s prompt-notice provision was a condition precedent to coverage under Georgia law. TransWorld notified Nationwide nearly four months after the freon-line incident, explaining it had first pursued the roofer’s insurance. The court held that waiting on another insurer’s response is not a valid justification, citing Lankford. Georgia’s intent is that notice be given “as soon as reasonably possible”—not after alternative coverage is exhausted or deemed inadequate.

Moreover, the court equated “promptly” with “as soon as practicable”/“as soon as reasonably possible,” following Bishop and Silva. Under Bituminous Casualty, an unjustified delay of just under four months is unreasonable as a matter of law. Accordingly, the 2017 claim failed at the coverage threshold.

3) 2018 Loss: “Suspension” Requires a Complete Cessation of Operations

Business-income coverage applied to losses sustained due to the necessary “suspension” of operations during the “period of restoration.” The court held “suspension” requires a total, not partial, stoppage of operations. It reached that conclusion by:

Using ordinary meaning (dictionary) that defines “suspension” as temporarily delaying, interrupting, or terminating an activity—concepts inconsistent with continuing any portion of the same activity.
Reading the policy as a whole: extended business-income coverage begins when property is repaired and “operations are resumed.” One cannot “resume” what never fully stopped.
Predicting Georgia would follow the national majority approach requiring a complete cessation (under SA Palm Beach’s Erie framework), and citing multiple jurisdictions and treatise support.

Because TransWorld continued operating throughout and after the 2018 event, business-income coverage was unavailable.

4) Bad Faith: No Coverage, No Bad Faith

Georgia bad-faith penalties generally require a covered loss wrongfully withheld. Because the court affirmed judgment against TransWorld on the coverage issues, the derivative bad-faith claims necessarily failed.

Impact and Practical Implications

A. For Insureds

Do not rely on “waiver” as a permanent fix: Even when an insurer adjusts and pays over time, Georgia treats that conduct as tolling the contractual suit-limitation—not eliminating it. The clock restarts when the claim is finally paid/denied. Insureds should diary the date of any “final payment” or clear cessation of negotiations and file suit within the contractual window.
Use written tolling/extension agreements: If litigation is contemplated but not immediate, negotiate written extensions of the suit-limitation. Absent express agreement, courts will likely apply Looney-style tolling only.
Give notice to your own insurer immediately: Pursuing a third-party recovery (e.g., tortfeasor’s insurer) does not justify delaying notice to your first-party insurer. Under Georgia law, an unjustified ~4-month delay can be fatal to coverage without any showing of prejudice by the insurer.
Business-income claims demand total shutdown: Unless your policy expressly covers “partial suspension” or “reduction in operations,” Georgia courts are likely (per this federal prediction) to require a complete cessation of operations to trigger business-income coverage. Consider endorsements that extend coverage to partial suspensions if your operations are hard to shut down entirely.
Preserve appellate arguments early: The court declined to consider arguments raised for the first time in a reply brief (e.g., continued post-payment investigation; waiver of notice). Raise all material issues in opening papers to avoid forfeiture.

B. For Insurers

Claims-handling clarity matters: When concluding an adjustment, communicate that a payment is “final” as to specified components to help establish the end of tolling. Absent clarity, factual disputes could arise about whether negotiations continued.
Prompt-notice defenses remain robust in Georgia: Where notice is a condition precedent, Georgia does not require a separate showing of prejudice. An unjustified delay approaching four months is likely unreasonable as a matter of law.
Draft for precision on business-income triggers: If the underwriting intent is to limit business-income to total shutdowns, the standard “suspension” language aligns with the majority rule. If partial-suspension coverage is intended, add explicit language (e.g., coverage for “slowdown or partial suspension of operations”).
Reservation of rights and waiver control: Continue to use clear reservation-of-rights letters. While continued adjustment can create a “waiver” of the limitation provision (tolling), careful correspondence reduces the risk of broader waiver or estoppel arguments.

C. Systemic Effects

Georgia litigation timelines: This decision reinforces the enforceability of one-year suit limitations in property policies and clarifies how to calculate the post-waiver window. Expect more motions on timeliness keyed to “final payment/denial” dates.
Notice jurisprudence: The court’s alignment of “promptly” with “as soon as practicable” cements a uniform standard in Georgia. Insureds should provide notice quickly even if they suspect other coverage will pay.
Business interruption during partial closures: The requirement of total cessation will narrow viable business-income claims where operations continue in some form (e.g., reduced hours, curtailed lines). Absent Georgia Supreme Court intervention or policy changes, district courts are likely to follow this majority-rule prediction.
Precedential weight: Although unpublished and thus non-binding, the Eleventh Circuit’s reasoning will be persuasive in Georgia federal courts and informative for Georgia state courts confronting similar questions.

Complex Concepts Simplified

Contractual suit-limitation period: A policy-imposed deadline (here, one year) for filing a lawsuit against the insurer. It can be shorter than the statute of limitations and is enforceable in Georgia.
Waiver vs. tolling: “Waiver” refers to the insurer’s conduct (e.g., continuing to adjust/pay) that prevents it from enforcing strict compliance with a deadline during ongoing negotiations. Under Georgia’s Looney rule, the effect of such waiver is to toll (pause) the deadline—not to erase it. When negotiations end/denial or final payment occurs, the countdown resumes.
Condition precedent: A policy requirement that must be satisfied before coverage attaches (e.g., “prompt notice”). Failure to comply—without justification—defeats coverage, often without the insurer needing to prove prejudice in Georgia.
Prompt notice: In Georgia, functionally equivalent to “as soon as reasonably possible” or “as soon as practicable.” A lengthy, unjustified delay (about four months) is deemed unreasonable as a matter of law.
Business-income coverage: Pays lost income when operations are necessarily “suspended” due to covered property damage during the “period of restoration.” “Suspension” generally means a complete stop, absent policy language extending coverage to partial slowdowns.
Period of restoration: The time needed to repair/replace damaged property. Extended business-income coverage, if provided, may continue after operations resume, often for a limited time (e.g., 60 days) until the business reaches its expected pre-loss trajectory.

Conclusion

TransWorld delivers three pivotal clarifications in the Georgia insurance context:

Insurer “waiver” of a contractual suit-limitation through continued adjustment/partial payment only tolls the deadline; it does not abolish it. The tolling ends when the insurer makes a final decision, and the insured must sue within the remaining contractual period.
“Prompt” notice functions like “as soon as practicable” in Georgia. Pursuing third-party recovery before notifying one’s own insurer is not a justification for delay; an unjustified four-month delay is unreasonable as a matter of law.
“Suspension” of operations in standard business-income provisions requires a total cessation of operations; partial slowdowns do not qualify absent policy language to the contrary.

Though unpublished, the Eleventh Circuit’s opinion synthesizes Georgia authority with national consensus and provides a roadmap for courts and practitioners. Insureds should promptly notify their insurers, track tolling endpoints with precision, and understand that business-income coverage typically hinges on a complete shutdown. Insurers should communicate claim conclusions clearly, maintain robust reservation-of-rights practices, and draft policy language that reflects the intended scope of business-income triggers. In the broader legal landscape, this decision will likely shape how Georgia federal courts handle suit-limitations after waiver, enforce prompt-notice requirements, and interpret business-income provisions going forward.