Insurance Fraud NEWS

Coalition Against Insurance Fraud

Kentucky court upholds right of insurers to use EUOs

August 25, 2017, Frankfort, KY — Insurance companies have a right to compel claimants to be interviewed under oath, the state's supreme court ruled today. The ruling reversed a lower court decision last year that said insurers have no such right because examinations under oath (EUOs) are not specifically written into the state's no-fault law.

The closely watched decision was hailed as a major victory for insurers and the fraud-fighting community. "EUOs are a vital tool to help deter and prosecute fraud. This ruling will aid fraud-fighting efforts and help keep premiums in check," said Dennis Jay, executive director of the Coalition Against Insurance Fraud.

Had the ruling gone the other way, Jay said, trial lawyers likely would have used it to challenge similar laws in other states and weaken insurers' ability to combat fraud.

The Coalition and the National Insurance Crime Bureau filed a joint amicus brief in the case, laying out several legal arguments why the court should uphold the use of EUOs.

The underlying case involved two Kentucky motorists who claimed they were injured in a crash. They sought no-fault benefits, yet refused to take part in a EUO. The state appeals court said the insurer must obtain a court order to conduct the interview. The insurer in the case, State Farm, appealed to Kentucky’s highest court.

Requiring court orders “encourages litigation by forcing insurers to obtain a discovery order from a court every time it is necessary to investigate a claim,” the Coalition and NICB argued in their brief.

The expensive, time-consuming effort will weaken anti-fraud efforts in the Kentucky. “The result is higher premiums, potentially higher coverage deductibles, and the threat that insurers will cease doing business in Kentucky if they cannot efficiently combat suspected fraudulent claims and financial loss becomes guaranteed,” according to the two anti-fraud organizations.

"(EUOs) benefit insurers and honest claimants by providing a means for determining the circumstance of accidents and the nature of injuries, and an intelligent, well-formed decision as to the applicability of coverage,” the anti-fraud groups say in the brief to the state Supreme Court.

The case is Adams v. State Farm. The court decision can be downloaded from

Source: Coalition news release

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