Many California property insurance policies require that you submit to an Examination Under Oath regarding your insurance claim. The questions asked at an Examination Under Oath are given orally before a court reporter who administers the oath and transcribes the proceeding. The examination may only be conducted upon reasonable notice, at a reasonably convenient location, and for a reasonable length of time.
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Examination Under Oath
An Examination Under Oath is typically conducted by a lawyer retained by the insurance company who will question the party making a claim for damages. You are entitled to have an attorney representing you when you attend the Examination Under Oath. Note that although your attorney can attend the examination, they do not have the right to ask questions. However, your attorney can protect you by objecting to questions on your behalf.
The purpose of the Examination Under Oath is to obtain information about your claim – the facts, circumstances surrounding your claim, and the amount of damages. Examinations Under Oath are frequently conducted under circumstances where the loss is undocumented or suspect. The insurance company may also require you to produce documents pertaining to your claim.
Many California property insurance policies require the insured to submit to an Examination Under Oath. The questions asked at an Examination Under Oath are given orally before a court reporter who administers the oath and transcribes the proceeding. The Examination is typically conducted by a lawyer retained by the insurance company. The insured may retain a denied insurance claims lawyer for protection, as well. The Examination may only be conducted upon reasonable notice, at a reasonably convenient location, and for a reasonable length of time.
Do You Need an Attorney for an Examination Under Oath
Every insurance claim is different. Every insured is different. The best answer to this question is that if you want protection and assurances during the Examination Under Oath, you should have your own attorney to represent your interests.
Production of Documents
Not only will you be required to answer questions during the examination, but will also be required to volunteer relevant information. Many if not most insurance companies will request that you produce documents at or before the Examination Under Oath. There are various reasons for this, such as to determine your whereabouts at the time of loss, your financial situation, etc.
The insurance company, through its lawyer, must notify you that you are entitled, free of charge, a copy of the transcript for your review. You are entitled to make sworn corrections to the transcript so that it accurately reflects your testimony.
Conditions of the Examination Under Oath
Once an insurance company requests an Examination Under Oath, the examination becomes a condition to the insurance company paying the claim. Although you must submit to the examination before the insurance company will pay the claim, there is no guarantee that the insurance company will pay the claim.
Objections to an Examination Under Oath
Objections to an Examination Under Oath are waived if not timely raised. If you have an objection such as to the reasonableness of the time, place, or method of examination, this objection must be timely raised or is waived. Only objections that may be made under state or federal law may be asserted. However, if asserting the objection results in you failing to provide information material to the claim, the insurance company may deny the claim in whole or in part.
To avoid any misstatements or conflicting testimony at the examination, you should request a copy of any previously recorded statement. However, where no litigation has been filed, and during the insurance company’s ongoing investigation, there is no legal obligation to provide a transcript or copy of the prior recorded statement.
Rights Of The Insured Requested To Submit To An Examination Under Oath
California Insurance Code section 2071.1 sets forth the rights of an insured who is requested to submit to an Examination Under Oath. Section 2071.1 provides in pertinent part:
When an insurance company decides to conduct a California Examination Under Oath, it must notify the insured of that decision, and must include a copy of the text of Insurance Code section 2071.1.
The insurance company may conduct the Examination Under Oath only to obtain information that is relevant and reasonably necessary for the processing or investigation of the claim. The insurance company may not conduct an Examination Under Oath for any improper purpose, such as to harass or intimidate an insured.
The Examination Under Oath may only be conducted upon reasonable notice, at a reasonably convenient place, and for a reasonable length of time.
The insured may be represented by counsel – his or her own insurance claims lawyer – and may record the Examination proceedings in their entirety.
The insurance company through its lawyer must notify the insured that, upon request, and free of charge, the insured may obtain a copy of the transcript of the Examination proceedings. Examinations Under Oath in California are recorded by a Court Reporter, who takes down everything said. The Reporter prepares a transcript, which is a written booklet, containing everything that was said on the record during the proceedings. The insured is entitled to review the transcript and make sworn corrections to the transcript so that it accurately reflects the testimony.
Objections on the insured’s behalf may be asserted during an Examination. The insured may assert such objections. Only objections that may be made under state or federal law may be asserted. However, if assertion of an objection results in the insured failing to provide information material to the claim, the insurance company may deny the claim in whole or in part. If the objection prevents the insurance company from being able to determine the amount of loss and validity of the claim, the insured’s rights may be affected!
An insured who submits a false or fraudulent claim may be subject to all criminal and civil penalties under California law.
Be aware – an insured may be subjected to more than one Examination Under Oath – Insurance Code section 2071 sets forth a standard Examination provision: “The insured, as often as may be reasonably required, shall . . . submit to examination under oath by any person named by this company, and subscribe the same . . . .” The insured must be reasonable, however, in its Examination requests.
Examination Under Oath may be required under a variety of insurance policies, regarding different types of California insurance claims, such as homeowner, automobile, motorcycle, and commercial insurance claims.
What Happens If You Do Not Submit To A Requested Examination Under Oath?
Once an insurance company requests that the insured submit to an Examination Under Oath in California, the Examination becomes a condition to the insurance company paying the claim. The insured’s giving the Examination must take place before the insurance company will pay the claim – although there is no guarantee that the Examination Under Oath will result in the insurance company paying the claim.
The courts in the State of California hold that the insurance company has the right to require the insured to submit to an Examination Under Oath even if its purpose is to gather evidence to defeat the claim. See, California Fair Plan Ass’n v. Superior Court (2004) 115 Cal.App.4th 158, 167; Brizuela v. Calfarm Ins. Co. (2004) 116 Cal.App.4th 578, 587.
It is important to remember, however, that the insurance company must act reasonably with regard to its demand for and collection of Examination Under Oath evidence. While the insurance company has the right to demand an Examination, the carrier’s right to demand an Examination must be exercised in a reasonable manner. See, Hickman v. London Assur. Corp. (1920) 184 Cal. 524, 529; Brizuela v. Calfarm Ins. Co. (2004) 116 Cal.App.4th 578, 588.
For example, the insurance company may not refuse to allow an insured to have an insurance claims attorney at the Examination. If the carrier does so refuse, the insured may be justified in not submitting to the Examination Under Oath.
Failing To Object Or Appear May Result In Waiver Or Insurance Claim Denial
If an insured objects to an Examination, because, for example, the proposed location is unreasonably far, the insured must timely object. Objections regarding Examination Under Oath are waived if not timely raised! So if you have an objection as to the reasonableness of the time, place, or method of Examination, this objection must be timely raised or is waived. For example, if an insured has had significant problems with a particular adjuster (who has been harassing or badgering), the insured should object if that adjuster intends to attend the Examination.
Note that the insured’s claims lawyer or attorney – your own counsel – does not have the right to examine (ask questions of) the insured – you – at the time of the Examination. This is different than a Deposition. Your own counsel can protect you, however, and object to questions on your behalf.
Also unlike a Deposition, the insured does have a duty to volunteer relevant information in an Examination Under Oath. What constitutes “relevant information” is somewhat vague, and open to interpretation.
An example may help demonstrate what constitutes “relevant information.” If after a fire loss, the insurance company suspects the insured started the fire, the carrier most likely will schedule an Examination Under Oath. Presumably, the insured will be asked as to his or her whereabouts at the time of the fire. If the insured is not asked, the insured may have an obligation to “volunteer” this information.
Whose Examination May Be Taken?
The insurance company may take the Examination of the persons identified as “insureds” under the policy. Note – though – some insurance policies also require the insured to “produce employees, members of the insured’s household or others for examination under oath to the extent it is within the insured’s power to do so.” See, West v. State Farm Fire & Cas. Co. (9th Cir. 1989) 868 F.2d 348, 351, fn. 1 (applying Calif. law), where the insured refused to submit to an Examination, the Court held that the insurer could properly request sworn statements from the insured’s wife and 2 teenage daughters.
The insurance company has the right to examine each insured separately. For example, spouses who are both insureds under the policy do not have the right to sit in on each other’s Examination Under Oath. See, State Farm Fire & Cas. Co. v. Tan (SD CA 1988) 691 F.Supp. 1271, 1274 (applying Calif. law).
What If You Have Provided A Prior Recorded Statement
Examination Under Oath in California often follow the insurance company’s taking of a recorded statement from the insured(s). To avoid misstatements or conflicting testimony at the Examination, the insured may request the insurer to provide a copy of his or her previously recorded statement before the Examination Under Oath proceedings. We recommend that you request a copy of any prior recorded statement.
Note however, that where no litigation has been filed, and during the carrier’s continued investigation of the claim, the insurance company is under no legal obligation to give an insured a transcript or copy of the prior recorded statement. These issues are all fact driven – there may be circumstances when it might be unfair or unreasonable for an insurer to demand an Examination Under Oath without complying with an insured’s request for an earlier recorded statement.
Documents You Should Request Documents From The Insurance Company
Many if not most insurance companies request insureds to produce documents at or before the Examination Under Oath. There are various reasons for this, such as to determine the insured’s whereabouts at the time of loss, the insured’s financial condition, etc. Reasonable requests should be complied with – otherwise the insurance company may use the insured’s refusal to provide the information as a basis for denying the insurance claim.
The insurance company must inform the insured that tax returns are privileged against disclosure, but may be necessary to process or determine the insurance claim. See, Insurance Code section 2071. The standard form fire insurance policy requires the insurance company to inform the insured that tax returns “are privileged against disclosure under applicable law but may be necessary to process or determine the claim.” This applies to policies issued or renewed on and after January 1, 2002.
Importantly, insureds may request copies of documents pertaining to the insurance claim, as well! Insurance Code sections 2071 and 10082.3 provide that in certain circumstances, after a loss, the insured may ask for “claim-related” documents – in fact, the insurance company is to inform the insureds of this right. The statutory provision (Insurance Code section 2071) states in part:
“The insurer shall notify every claimant that they may obtain, upon request, copies of claim-related documents. For purposes of this section, ‘claim-related documents’ means all documents that relate to the evaluation of damages, including, but not limited to, repair and replacement estimates and bids, appraisals, scopes of loss, drawings, plans, reports, third-party findings on the amount of loss, covered damages, and cost of repairs, and all other valuation, measurement, and loss adjustment calculations of the amount of loss, covered damage, and cost of repairs. . .
Within 15 calendar days after receiving a request from an insured for claim-related documents, the insurer shall provide the insured with copies of all claim-related documents, except those excluded by this section. . . .”
Before the California Examination Under Oath, in addition to providing the documents reasonably requested by the insurance company, you may want to request from the insurance company your own claim-related documents pertaining to the insurance claim!
What To Do If An Insurance Company Requests Your Examination Under Oath
If an insurer requests your Examination Under Oath, understand your rights regarding such Examinations. Read the information provided above.
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