Tag Archives: EUO

QUICK NOTE: EXAMINATION UNDER OATH OF NON-INSURED

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Property insurance policies contain an examination under oath (“EUO”) provision that requires the insured and the insured’s agents and representatives to submit to an EUO.   An EUO is a sworn statement – – a pre-lawsuit deposition, so to speak.  It is a post-loss condition in the property insurance policy that, absent certain circumstances, the insured must comply with.

In a recent decision, Avatar Property & Casualty Insurance Company v. Castillo, 45 Fla. L. Weekly D966a (Fla. 4th DCA 2020), the issue was whether the insured was required to produce his handyman and restoration company for an EUO.   The EUO provision in the policy stated:

In the County where the “residence premises” is located you, your agents, your representatives, including any public adjuster engaged on your behalf, and any and all “insureds” must submit to [EUOs] and sign same when requested by us.

The handyman and restoration company were involved in furnishing estimates or mitigation work and the insurer claimed they should be deemed an agent or representative of the insured.  The appellate court, affirming the trial court, disagreed:

[T]he handyman and the water restoration employees were not the insureds’ “agents” or “representatives” under the dictionary definitions of those terms. Further, to the extent the policy here is considered uncertain, we are compelled to construe the interpretation against the insurer.  The insurer, as the policy’s drafter, easily could have added language including “any persons who inspected or repaired the covered property.” For us to do so now would re-write the policy.

Avatar Property & Casualty Insurance Co., supra.

 

Please contact David Adelstein at dadelstein@gmail.com or (954) 361-4720 if you have questions or would like more information regarding this article. You can follow David Adelstein on Twitter @DavidAdelstein1.

 

INSURER’S “FAILURE TO COOPERATE” DEFENSE

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shutterstock_392537986If an insurer takes this position, it will typically be denying both defense and indemnification obligations, meaning the insured could be forfeiting coverage that otherwise exists through his/her/its failure to cooperate with the insurer.  This defense by the insurer is not absolute as recently explained by the Fourth District in Barthelemy v. Safeco Ins. Co. of Illinois, 43 Fla.L.Weekly D2379a (Fla. 4th DCA 2018) discussing the elements of this failure to cooperate defense.

 

In this case, dealing with an automobile accident, the insurer denied both defense and indemnification obligations to its insured under the failure to cooperate defense.  The insurer argued its insured failed to cooperate by failing to submit three times to an Examination Under Oath (known as an “EUO”).  As a result, the insurer did not provide its insured a defense in the underlying lawsuit that exposed the insured to judgments.  The insured then sued its insurer for a declaratory judgment where the overriding issue was the insurer’s failure to cooperate defense. 

 

The Fourth District confirmed that in a failure to cooperate defense case, “the insurer must show a material failure to cooperate which substantially prejudiced the insurer.”  Barthelemy, supra, quoting Bankers Ins. Co. v. Macias, 475 So.2d 1216, 1218 (Fla. 1985).  This means the insurer must show: (1) the insured materially failed to cooperate and (2) this material failure substantially prejudiced the insurer. 

 

Please make sure to consult with counsel if your insurer raises this failure to cooperate defense or takes the position that you, as the insured, forfeited otherwise valid coverage under your insurance policy.

 

Please contact David Adelstein at dadelstein@gmail.com or (954) 361-4720 if you have questions or would like more information regarding this article. You can follow David Adelstein on Twitter @DavidAdelstein1.