The “EUO” or examination under oath in insurance policies have often been the tools of the SIU or special investigation units. Or as so aptly stated in the following decision on behalf of Ms. Adams – “EUOs are often used as a tool to harass, annoy, embarrass or oppress claimants in opposition to the purpose of the MVRA. Adams also contends that State Farm is attempting to supersede the MVRA with its policy provisions.” An even greater abuse would be for the reparations obligor to use the EUO as its basis for getting particular information under threat of loss of benefits for failure to cooperate and in defense of an action should the claimant file suit. Yes, it is a dark and dirty little tool that is more a post-claims underwriting trick rather than information gathering.
In the following decision,Roniesha Adams, Mother and Guardian of Minor Child B.A. v. State Farm Mutual Automobile Ins. Co., COA Published, 6/12/2015, the Court of Appeals put the brakes on this practice within the context of the motor vehicle reparations act (KRS Sec. 304.39-280(3) which provides that –
In case of dispute as to the right of a claimant or reparation obligor to discover information required to be disclosed, the claimant or reparation obligor may petition the Circuit Court in the county in which the claimant resides for an order for discovery including the right to take written or oral depositions.
Judge Clayton stated it succinctly in one paragraph:
In Miller v. United States Fidelity & Guaranty Co., 909 S.W.2d 339, 341 (Ky. App. 1995), a panel of our Court held that “[t]he circuit court may not enter an order for an examination without rhyme or reason, thereby entitling a reparation obligor to an examination simply upon demand.” In a case such as this, where there were medical reports and police reports indicating injuries and the events that occurred, a policy clause which required an EUO prior to payment of the claim and as a bar to the claim should one not be done, would be in direct opposition to the purpose of the MVRA. Should State Farm wish to obtain a statement from Adams, its remedy would be to seek a court order requiring Adams to submit to discovery. The trial court, therefore, erred in granting declaratory and summary judgment on this issue. We, therefore, reverse the decision of the trial court and remand this action for further proceedings including discovery.