STATE LAW – TENNESSEE LIBRARY – GUIDE 22
Tennessee Settlement, Release & Claim Closure
Settlement should come only after responsible parties, applicable liability coverage, UM/UIM rights, damages, hospital liens and reimbursement interests have been identified.
Read the actual release before accepting payment
Identify every released person and entity, the claims being released, consideration, indemnity or hold-harmless language, confidentiality terms and whether property and bodily-injury claims are being resolved together or separately.
Preserve Tennessee UM/UIM rights before liability settlement
Section 56-7-1206 creates a Tennessee procedure for accepting liability limits while preserving UM/UIM rights. Give the required notice and allow the statutory carrier response process before releasing the tortfeasor.
Resolve liens and reimbursement before distribution
Resolve perfected hospital liens and other valid reimbursement claims before final distribution. Sections 29-22-101 and 29-22-104 and Franks v. Sykes make hospital-lien compliance a distinct settlement-closing issue.
Settlement handling can affect insurer exposure
For liability carriers, Johnson v. Tennessee Farmers illustrates how inadequate investigation or settlement handling can contribute to excess exposure. Keep a complete record of demands, offers, limits, evaluations and release terms.
Current-law review: October 4, 2026. Verify the accident-date policy, current primary authority, later case treatment, and claim-specific deadlines before legal reliance.
PUBLIC-INTEREST LEGAL EDUCATION
VictimsGuide does not provide legal services or create an attorney-client relationship. Insurance requirements, deadlines, remedies and controlling authority can change. Verify current primary authority, policy language and the law applicable to the particular event before legal reliance.
Authorities and source notes
- Tennessee UM/UIM procedure, service, arbitration and settlement statute — Tenn. Code Ann. § 56-7-1206
- White / Goan — Tennessee UM/UIM settlement-preservation procedure — Sidney White v. State Farm Fire & Cas. Co., W2019-00918-COA-R3-CV (Tenn. Ct. App. 2020); Goan v. Mills, E2016-01206-COA-R3-CV (Tenn. Ct. App. 2017)
- Tennessee hospital lien statutes — Tenn. Code Ann. §§ 29-22-101, 29-22-104
- Franks v. Sykes — 600 S.W.3d 908 (Tenn. 2020)
- Johnson v. Tennessee Farmers Mutual Insurance Co. — 205 S.W.3d 365 (Tenn. 2006)
Registry authority mapping and cited propositions reviewed October 4, 2026. Canonical source preservation and formal subsequent-history review remain maintenance items where noted.
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