Understanding the EUO: A Right, Not a Debate
The Examination Under Oath (EUO) is one of the most misunderstood tools in the insurance claims process. At its core, the EUO is a private examination of an insured, rooted in a contractual right established when the insurance policy is issued.
Despite its long-standing legal recognition, misconceptions about the EUO have led to debates, misuses, and even abuses over time. Let’s explore what the EUO truly is, why it’s important, and how it should be approached correctly.
What Is an EUO?
At its simplest, an EUO is a private examination of an insured. Here are some key points to understand:
- It’s a Private Right: The EUO is not open to the public. It exists exclusively as part of the contractual relationship between the insurance company and the insured.
- It’s a Right Established at Policy Issuance: The right to an EUO is created the moment the insurance policy is issued. Once a claim is filed, the company has the right to exercise this provision to gather necessary information.
- It’s Not for Everyone: Only those who qualify as “insureds” under the policy can be required to participate in an EUO
The Legal Foundation of the EUO
The right to conduct an EUO is not just contractual—it’s also legally recognized. In fact, the U.S. Supreme Court acknowledged this right in 1884, affirming that insurance companies can require insureds to participate in Examinations Under Oath to support their claims.
This landmark decision remains the law of the land, solidifying the EUO’s role as a vital investigative tool.
The Purpose of the EUO
The primary goal of an EUO is straightforward: to gather the information and documentation necessary to support a claim. It provides an opportunity for the insured to:
- Clarify any discrepancies in the claim.
- Present their story and provide context.
- Submit any required documentation.
When conducted properly, the EUO is a critical step in ensuring claims are handled fairly and thoroughly.
Common Misuses and Misunderstandings
Despite its clear purpose, the EUO has been misused over the years. Common issues include:
- Using the EUO as a Sword: Some claims professionals invoke the EUO to pressure insureds, especially when they don’t receive satisfactory answers. Threatening the insured with policy provisions or duties to cooperate is not the correct approach.
- Misinterpreting the Process: Many misunderstand the EUO’s purpose, treating it as a confrontational tool rather than an opportunity to clarify and gather information.
- Abusing the EUO: Over time, the EUO has been misapplied in ways that undermine its original intent, creating unnecessary tension and confusion in the claims process.
The Right Way to Approach an EUO
To avoid misuse and ensure the EUO serves its intended purpose, follow these principles:
- Respect the Process: The EUO is a right, not a debate. As long as the process is followed correctly, there’s no need to justify the company’s decision to conduct an EUO.
- Focus on Information Gathering: Approach the EUO as an opportunity for the insured to provide the necessary information and documentation to support their claim.
- Avoid Threats or Pressure: Never use the EUO as a tool to intimidate or coerce the insured. It should be a fair and objective process.
Conclusion
The EUO is a vital investigative tool grounded in contractual and legal rights. When approached correctly, it provides a structured, fair, and private process for gathering the information needed to resolve claims.
However, it’s crucial to avoid misusing or misunderstanding the EUO. By respecting its purpose and following the proper process, claims professionals can ensure the EUO remains an effective tool for both the insurer and the insured.
Ready to master the EUO process and approach it the right way? Start by understanding its foundation and purpose—it’s not just a right, it’s a responsibility.
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Danny Vazquez
Danny Vazquez is the National EUO, LLC CEO.
Danny is a central leader on Claims, Investigations and EUOs in the insurance and legal industries.
As CEO, Danny took the knowledge and insights gained throughout his 25 plus years legal career to establish National EUO as the Nation's leading company on EUO services and EUO training.
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