New Citizens Policy Language Raises Questions About the Obligations of Policyholders and Public Adjusters

(Note: This guest blog is by Nicole Vinson, an attorney with Merlin Law Group in the Tampa, Florida, office. She will be writing a guest blog series on Examinations Under Oath and Public Adjusters).

The new language in Citizens Property Insurance Corporation’s 2010 policy has spurred debate and questions about the obligations of both policyholders and public adjusters in Florida.

This is the Examination Under Oath (EUO) requirement in the Citizens’ policy. The highlighted portion, lines 5 a-b, are new and controversial part:

FORM CIT HO-01 10

As often as we reasonably require:

1. Show us the damaged property

2. Provide us with records and documents we request and permit us to make copies

3. You or any "insured" under this policy MUST:

a. Submit to examinations under oath and recorded statements, while not in the presence of any other "insured"; and
b. Sign the same;

4. If you are an association, corporation, or other entity; any members, officers, directors, partners or similar representatives of the association must:

a. Submit to examinations under oath and recorded statements, while not in the presence of any other "insured"; and
b. Sign the same;

5. Anyone you hire in connection with your claim and anyone insured under this policy other than an "insured" in (3) or (4) above, must:

a. Submit to examinations under oath and recorded statements, while not in the presence of any other "insured;"and
b. Sign the same;

Generally, insurance policies contain a requirement that the insured must give both a recorded statement and an Examination Under Oath (EUO) in the “Conditions” section of a policy. A recorded statement may be used to gather information by insurance company at the onset of the claim. An EUO is a more in-depth interrogation by a lawyer for the insurance company. The requirements of policyholders in connection with an EUO depend on the policy language. Many policies require insureds to sit for an EUO, sign the recorded transcription, and give the EUO while not in the presence of any other insured. Essentially, an attorney for the insurance company asks a long series of questions while a court reporter records the whole thing. An EUO is more similar to a deposition than a simple recorded statement, except that the EUO is governed by the rules explained in the policy and not the Rules of Civil Procedure. EUOs are adversarial. Now, at least for Citizens claims, it seems public adjusters are subject to the same requirements.

The insurance company has many other ways to learn about a claim and the public adjuster’s involvement and evaluation of it. This series of posts will consider the implications of Citizens’ new policy language and will discuss what is happening now on the front lines.

–Nicole Vinson