Seth I. Weinstein | Lewis Brisbois | March 9, 2018
While the weather has temporarily warmed in parts of the Northeast, January brought bitter cold temperatures throughout the East Coast and elsewhere. A deluge of claims have followed associated with frozen pipes.
Many claim disputes pertain to whether an insured utilized “best efforts,” “due diligence,” or “reasonable care” to maintain heat in an insured property. Further, many claim disputes pertain to whether a property was vacant, unoccupied, or under construction at the time of a loss. It is imperative that insurers request and obtain the necessary documents and information from an insured to evaluate these coverage issues. Utility and maintenance records should be requested and analyzed, as well as documentation concerning the occupancy and use of the property. Third parties reported to be tenants/occupants can be questioned and in many cases on-site inspections of the property reveal alternative and/or contributing causes to pipe bursts often blamed on freeze conditions.
Many insureds are represented by public adjusters who provide limited information on behalf of insureds with regard to efforts made to maintain heat and/or to establish a property was not vacant or unoccupied. Further, often allegations are made that construction was underway at a property at the time of the loss with no supporting documentation.
Utilizing an examination under oath to address and investigate these issues is very often an efficient and important investigation tool. Conducting an examination under oath with coordinated document/information requests will provide an insurer with the opportunity to obtain necessary information which will enable prudent coverage determinations to be made. An examination under oath is an important investigative tool, which permits an insurer to determine the merits of legitimate claims in addition to exposing fraudulent claims.
It is widely recognized that examinations under oath are too infrequently used in claims that do not involve suspicious circumstances. An examination under oath assists the insurer to possess itself of all knowledge and information in regard to the facts, which will enable the insurer to decide upon its obligations under a policy and to protect from false claims.
Although some examinations under oath can be a day long and detailed, many are simple and often take 1 to 2 hours. Examinations under oath provide a cost-effective means to evaluate claims and often lead to the avoidance of litigation. Examinations under oath can be conducted in many claims on an expedited basis, which enables prompt coverage positions to an insured.