Property insurance policies typically include provisions that the policyholder must cooperate in investigation and adjustment. This includes an examination under oath (EUO) — answering a lot of questions from the insurance company’s lawyer. Failure of the policyholder to submit to the examination may preclude even an innocent insured from any recovery under the insurance contract.

Policyholders who represent themselves against insurance company lawyers make fatal errors.

Generally insurance companies may impose almost any conditions upon their obligations so long as they are not inconsistent with public policy.  An insured cannot avoid the binding effect by neglecting to read the insurance policy. With rare exceptions, the policyholder must comply with the conditions in order to hold the insurer liable in court.

Policyholders who appear for an EUO without a lawyer knowledgeable about property insurance law may make fatal mistakes that cannot be undone.

In the decade I spent in a law firm representing insurance companies, part of my work involved property insurance claims, particularly those of suspected fraud and arson. For years I spent a lot of time going through burned out residential and commercial buildings to see the evidence of arson that investigators had found.

In many cases, insurance companies hired me to conduct examinations under oath of policyholders. It was never a contest of equals because so many policyholders either came alone or hired a lawyer who knew nothing about this aspect of insurance law.

No do-overs: Eleventh Circuit decision on policyholder’s fatal error before hiring a lawyer.

In a recently reported decision an Allstate policyholder’s house burned. The insurer developed doubts whether he complied with condition of the homeowner’s insurance policy that the property must be used as a residence. The insurer gave notice for the policyholder to appear for an examination under oath. He showed up, angry and unrepresented, and refused to answer substantive  about his residence until the insurer recanted statements in a letter from its attorney which he found offensive.

The insurance company’s attorney, whose attitude can easily provoke such counterproductive anger, said, “[I]f you do not respond to the questions that are put to you here today, Allstate will treat that failure to respond as a material breach of the contract…. And … refusal to respond could result—probably will result in the denial of this claim for that reason standing alone.” The policyholder stated that he would answer the insurer’s questions but insisted that the insurer recant the disputed statements in the letter first. Of course, the insurance company recanted nothing.

A year later, the policyholder hired a lawyer who demanded payment and offered to have the policyholder appear for an EUO. The U.S. Eleventh Circuit Court of Appeals held that the offer to submit to an EUO a year after refusing to answer questions was too little too late, and ruled for the insurance company. Hutchinson v. Allstate Insurance Company, 2018 WL 3359549 (11th Cir., decided July 10, 2018).

Long history of courts supporting insurers’ position on EUO’s.

For well over a century, Georgia law has recognized that a policyholder who fails to provide information requested by the insurance company in this process breaches the terms of the policy. That results in loss of the right to collect under the policy. Few excuses for failure to comply suffice. In an early case, the Georgia Supreme Court held that if an insured absents himself so that he cannot be found to be served with an EUO notice, that is construed as refusal to submit to the EUO. Firemen’s Fund Ins. Co. v. Sims, 115 Ga. 939, 42 S.E. 26 (1902)

Cooperation with the insurer’s investigation of the claim, including submitting to an examination under oath, is a condition precedent to the right to recover under the contract. Buffalo Ins. Co. v. Steinberg, 105 Ga.App. 366 (1), 124 S.E.2d 681 (1962).

This is ordinary contract law, which applies to contracts of insurance. “When a plaintiff’s right to recover on a contract depends upon a condition precedent to be performed by him, he must allege and prove the performance of such condition precedent, or allege a sufficient legal excuse for its nonperformance. ” Wolverine Ins. Co. v. Sorrough, 122 Ga.App. 556, 560 (3), 177 S.E.2d 819 (1970). See also, Halcome v. Cincinnati Ins. Co., 254 Ga. 742, 334 S.E.2d 155 (1985).

The intimidating EUO notice.

In cases of suspected insurance fraud, including arson, insurance companies typically have their lawyers send policyholders formal written notices to produce a long list of documents.

The list of documents requested may be overwhelming, especially when the policyholder’s files may have been lost in a fire. It may include several years of records of income taxes, banking, income, expenses, insurance policies and claims, debt, credit records, and the purchase of all the personal property claimed to be lost.

They notify the insured to show up at a specific time and place to answer questions under oath. To appear reasonable and avoid being accused of violating an implied covenant of good faith and fair dealing, the insurer may show some flexibility about scheduling. If the insurance company’s lawyer can subtly bait the policyholder into refusing to answer questions, the insurance company wins.

Possible defenses against EUO notices.

While the law is clear about the requirement for policyholders to cooperate with the insurer’s investigation and participate in an EUO, there are a few circumstances that have precluded summary judgment in favor of the companies. Then the reasonableness of the EUO notice becomes a jury question and may open the door to settlement negotiations. Examples include:

  • Medical inability to comply. Blackburn v. State Farm Fire & Cas. Co., 174 Ga.App. 157, 329 S.E.2d 284 (1985).
  • Reasonableness of notice for EUO more than sixty days after receipt of a demand for payment before. Northern Assur. Co. of America v. Karp, 257 Ga. 403, 54 S.E.2d 129 (1987).
  • Alleged errors in EUO transcript as justification for refusal to sign transcript. Nichols v. Pearl Assur. Co., 71 Ga. App. 378, 31 S.E.2d 127 (1944).

Hire a property insurance lawyer early.

Remember that adage that anyone who tries to represent himself has a fool for a client.

Anyone facing an insurer that sends a notice to appear for an examination under oath should not try to go it alone. It is important to immediately hire a lawyer with experience in property insurance. Many lawyers who are good in automobile insurance matters are clueless about property insurance.

While my practice no longer focuses on this area, I can guide folks to other lawyers who practice property insurance law.


Ken Shigley is a past president of the State Bar of Georgia, past chair of the State Bar’s Tort & Insurance Practice Section, past chair of the Georgia Insurance Law Institute, and past chair of the American Association for Justice Motor Vehicle Collision, Highway & Premises Liability Section. He is lead author of Georgia Law of Torts: Trial Preparation & Practice (Thomson Reuters West, 2010-2018). His Atlanta-based law practice is focused on catastrophic injury and wrongful death including those arising from commercial trucking accidents and those involving brain, neck, back, spinal cord, amputation and burn injuries. Work on all these types of cases requires expertise in insurance law.