Insurers’ Motion to Void Coverage for Failure to Attend EUO Denied

    The insurer’s motion for summary judgment and disposal of the insureds’ claim due to failure to attend an examination under oath (EUO) was denied. Perkins v Syndicate 4242 of Lloyd’s of London, 2022 U.S. Dist. LEXIS 196922 (W.D. La. Oct. 28, 2022).

    The insureds’ home suffered damage from Hurricane Laura on August 27, 2020, and Hurricane Delta on October 9, 2020. The insureds reported damage after Hurricane Laura under the homeowners policy. They filed suit in August 2021, alleging that Lloyds failed to adequately inspect their claims. The court issued a Case Management Order (CMO) that governed initial disclosures and the parties’ participation in a streamlined settlement process for hurricane claims. The dispute did not settle, however, so the matter was set for a bench trial.

    Lloyds moved for summary judgment arguing that the insureds’ claim for personal property loss should be dismissed because they refused to submit to an EUO. Under the “Duties After Loss” provision, the policy required the insures to submit records and documents requested by the insurer and to submit to an EUO. Lloyds requested an EUO after issues arose with respect to the insureds’ claim for personal property loss. The insureds submitted lists representing various items allegedly damaged and valuing the items for replacement cost at $583,833.25. The insureds failed to provide receipts for most of the items even after requested by Lloyds. Further, the insureds’ claimed the loss of two Persian rugs at a combined value of $110,000. The were unable to provide the rugs or any other proof of loss because they purchased the rugs at an auto show. Further, the rugs were thrown out without photographing them after the storm.

    In June, Lloyds requested an EUO for July 1, 2021, in New Orleans. The insureds objected to having to travel to New Orleans. Lloyds then offered to conduct the EUO in Lake Charles, closer to the insureds’ home. In September 2021, the insureds responded that the claim had been adequately investigated and refused to attend the EUO. 

    Therefore, Lloyds contended the insureds failed to comply with their Duties After Loss which voided their claim for personal property loss.

    The court disagreed. Lloyds could not show prejudice from the insureds’ refusal to sit for an EUO first requested in June 2021. Lloyds did not seek an EUO until several months after the storm and after compilation of the inventory. It also took the refusal by the insureds in September 2021 as the last word and made no move to compel the examination while the case was under the CMO’s streamlined settlement process, even though the CMO allowed for the parties to seek leave to conduct discovery. Lloyds made no mention of the EUO until filing their motion for summary judgment in October 2021. 

    Therefore, Lloyds showed no basis for voiding the policy and their motion for summary judgment was denied,