BILL NUMBER:S5302

TITLE OF BILL:  An act to amend the insurance law, in relation to
examination under oath of covered persons pursuant to the
comprehensive motor vehicle insurance reparations act

PURPOSE OF BILL:

To provide fairness, guidance, clarity and consistency in the
application of the standards for Examinations Under Oath, and to more
equitably administer claims for first party benefits

SUMMARY OF PROVISIONS OF BILL:

Section 1 would amend section 5103 of the Insurance Law to .require
the following: The Examination Under Oath OF THE APPLICANT shall be
scheduled by the company directly or by an attorney appointed by the
company for purposes of conducting the Examination Under Oath for
whose conduct and activity the company is directly responsible. The
Examination Under Oath OF THE APPLICANT may not be demanded unless and
until an application for no-fault benefits has been received by the
company. In any Examination Under Oath, the (claimant) APPLICANT shall
have the right to be represented by counsel. The examination shall be
conducted upon oath or affirmation. The Examination Under Oath shall
be conducted in the county where the (claimant) APPLICANT resides or,
at the (claimant's) APPLICANT'S option, in the office of his/ HER
              

representative unless the (claimant or claimant's) APPLICANT OR
APPLICANT'S representative and the company agree otherwise. The day
and time that the Examination Under Oath is scheduled must be agreed
upon by the company and the (claimant or claimant's) APPLICANT OR
APPLICANT'S representative. A demand for an Examination under Oath
shall be in writing and shall be served personally or by registered or
certified mail upon the (claimant) APPLICANT unless the (claimant)
APPLICANT is represented by an attorney, when it shall be served
personally or by mail upon his/HER attorney. The demand shall state
the person before whom the examination is to be held, the time, place
and subject matter thereof. Written notice of the Examination Under
Oath must be received by the (claimant) APPLICANT or HIS/HER
representative at least 14 days prior to the examination date to be
effective to require claimant to appear. The notice shall advise the
(claimant) APPLICANT of the right to video or otherwise record the
examination.  The (claimant) APPLICANT shall be allowed reasonable
adjournments which shall be accepted up to no less than 24 hours prior
to the examination. If the claimant to be examined does not understand
the English language, upon reasonable notice to the company seeking
the examination, the company must, at their own expense, provide a
translation of all questions and answers, and may use the services of
an interpreter whose Compensation shall be paid by the company seeking
the examination. The Examination Under Oath must be transcribed before
a notary public duly licensed to administer oaths in the State of New
York. Any Examination Under Oath that is not so transcribed may not be
cited as the basis of any denial of a claim for first party benefits.
The transcript of the examination shall not be subject to or available
for public inspection, except upon court order upon good cause shown,
but shall be furnished to the (claimant) APPLICANT or HIS/HER
representative within 60 days of the examination. The conduct of
Examinations Under Oath shall be governed by the Uniform Rules For The


Conduct Of Depositions, Part 221 of the Uniform Rules for the New York
State Trial Courts.

An Examination Under Oath of the (claimant) APPLICANT may be requested
where (1) The company suspects fraud perpetrated by the (claimant)
APPLICANT which must be clearly conveyed to the (claimant or
claimant's) APPLICANT OR APPLICANT'S representative. The company must
supply the (claimant or claimant's) APPLICANT OR APPLICANT'S
representative with any and all evidence supporting their claim of
fraud so as to preserve claimant's 5th amendment right against being
compelled to testify against himself. (2) The company suspects that
(claimant) APPLICANT is receiving unnecessary treatment which must be
clearly conveyed to the (claimant or claimant's) APPLICANT OR
APPLICANT'S representative. The company must supply the (claimant or
claimant's) APPLICANT OR APPLICANT'S representative with any and all
evidence supporting their claim that the treatment is unnecessary,
including but not limited, to peer reviews. (3) The company suspects
that the treating provider or facility is billing for treatment that
(claimant) APPLICANT is not receiving which must be clearly conveyed
to the (claimant or claimant's) APPLICANT OR APPLICANT'S
representative. The company must provide (claimant or claimant's)
APPLICANT OR APPLICANT'S representative with any and all evidence
supporting their claim that the billing is not commensurate with the
actual treatment received, including but not limited to, the bills
submitted by the treating provider. (4) The company has a suspicion
that the claim needs to be verified for a reason not enumerated above.
The justification must be relevant to the verification of the claim
and the reason must be clearly conveyed to the (claimant or
claimant's) APPLICANT OR APPLICANT'S representative. The company must
provide supporting evidence to support their claim to (claimant or
claimant's) APPLICANT OR APPLICANT'S representative. (5) If the
(claimant or claimant's) APPLICANT OR APPLICANT'S representative
wishes to contest the request for an Examination Under Oath because
(claimant or claimant's) APPLICANT OR APPLICANT'S representative
believes the request to be pie-textural or suspects abuse in
requesting the examination, they may submit the same to the State
Insurance Department for review within 5 business days of receipt of
the written request from the company. (6) The company may not deny an
APPLICANT'S claim based upon a treating provider's failure to appear
at an Examination Under Oath.  If the treating provider fails to
appear at an Examination Under Oath,
 the (claimant may) APPLICANT SHALL not be held responsible to the
provider for services rendered by that provider. (7) When the company
requires an Examination Under Oath of an applicant to establish proof
of claim, such requirement must be based on the application of
objective standards so that there is specific justification for the
use of such examination. Insurer standards shall be available for
review by department examiners, as well as by the claimant and his
representative.

The scope of the Examination Under Oath will be narrowly tailored to
the reasons or justification for seeking the examination as set forth
in the company's written request. Any question that goes beyond the
scope may be objected to and such objected to question may be
submitted by the company within 7 days of the completion of the
scheduled and conducted examination to the (State Insurance
Department) NEW YORK STATE DEPARTMENT OF FINANCIAL SERVICES to


determine if the objected to question is beyond the scope of the
examination. If any question is determined to be beyond the legitimate
scope of the examination and its original written justification for
the same, the (claimant) APPLICANT will not be required to respond to
the question and cannot form the basis of a denial. If the objected to
question is determined by the (State Insurance Department) DEPT OF FIN
SERVICES to be legitimate and narrowly tailored to meet the objectives
contained in the written request for the Examination Under Oath
initially given by the company when the examination was scheduled, the
examination may be rescheduled in the manner set forth above for the
limited purpose of receiving responses to the improperly objected to
questions, as determined by the (State Insurance Department) DEPT OF
FIN SERVICES, and responses to other questions that might naturally
flow from (claimant's) APPLICANT'S responses that are likewise
narrowly tailored to investigate the legitimate justification for
conducting the examination given in the company's original written
request, with the same rules for objections applying as set forth
above. The company may not deny a claim based upon an objection at an
Examination Under Oath unless the company completes the above
objection appeals procedure, wins said appeal, and the claimant
thereafter fails to comply with the demand for a further examination
under oath. The Examination Under Oath shall not exceed 3 hours from
the time the first question is asked until the last question is asked
unless reasonable cause exists. For examinations conducted with the
aid of an interpreter, the time shall not exceed 4 hours unless
reasonable cause exists. The (claimant or claimant's) APPLICANT OR
APPLICANT'S representative shall have the right to terminate the
examination upon the passage of the above time limits. The claim may
not be denied if the (claimant or claimant's) APPLICANT OR APPLICANT'S
representative terminates the examination after the allotted time has
expired.  Issues of liability related to any ongoing or potential
third party action arising from the subject claim may be addressed at
the Examination Under Oath. The Examination Under Oath and any
investigation related thereto is confidential and shall not be subject
to discovery or use in any third party action arising out of the
incident that serves as the basis of the claim for first party
benefits, and may not be used against the claimant in any such third
party action.

Absent an admission of fraud by (claimant) APPLICANT during the
Examination Under Oath, or allegation of fraud perpetrated by the
(claimant) APPLICANT Supported by the testimony elicited at the
examination, the Examination Under Oath alone shall not form the basis
of a denial of first party benefits. Any denial of first party
benefits based in part upon the Examination Under Oath, including one
based on fraud by the claimant, shall be accompanied by any other
written reports, including investigative, that in whole or in part
form the basis of the denial. The claimant and his representative will
have the right to conduct an Examination Under Oath, upon written
request to the company, of any individual, including the person or
attorney conducting or reviewing the examination, whose reports or
opinions form the basis of any denial of first party benefits based in
whole or in part on the examination.  Once an insurer has denied
further first party benefits to the claimant for any reason, they are
barred from seeking any further verification of the claim including,
but not limited to, conducting medical examinations and/or further
Examinations Under Oath. The denial of a claim for failure to attend


an Examination Under Oath shall not be retroactive to the date of the
claim, but shall only result in the denial of all benefits received
after the date of the Examination Under Oath.

JUSTIFICATION:

An Examination Under Oath is intended to verify treatment based on
objective standards. The No-Fault mandatory Personal Injury Protection
Endorsement set forth in 11 NYCRR 65-1.1 (d) contains the provision
that "(u)pan request by the Company, the eligible injured person or
that person's assignee or representative shall:... (b) as may
reasonably be required submit to examinations under oath by any person
named by the Company and subscribe the same". Section 65-3.5(e) states
that 11 (w)hen an insurer requires an examination under oath of an
applicant to establish proof of claim, such requirement must be based
upon the application of objective standards so that there is specific
objective justification supporting the use of such examination".
Section 653.2 includes the following claim practice principles for all
insurers providing first party benefits:  (a) Have as your basic goal
the prompt and fair payment to all automobile accident victims; {b)
Assist the applicant in the processing of a claim. Do not treat the
applicant as an adversary; (c) Do not demand verification of facts
unless there are good reasons to do so; (d) When verification of facts
is necessary, it should be done as expeditiously as possible; (e)
Clearly inform the applicant of the insurer's position regarding any
disputed matter; (f) Respond promptly, when a response is indicated,
to all communications from insureds, applicants, attorneys and any
other interested persons.

Unfortunately, due to the lack of any standards governing Examinations
Under Oath, insurers providing first party benefits are permitted to
conduct intrusive cross examinations of claimants and the
documentation submitted in support of their claims. The amendments
proposed by this Bill would clarify the rules for an Examination Under
Oath, ensure the equality of standing between claimants and insurers,
and promote the claim practice principles expected of all insurers
providing first party benefits, including the prompt and fair payment
of claims.

LEGISLATIVE HISTORY:

S7357 of 2012.

FISCAL IMPLICATIONS FOR STATE AND LOCAL GOVERNMENTS:

None.

EFFECTIVE DATE:

This act shall take effect immediately and shall be applicable to: (i)
all claims made on or after the effective date of this act; and (ii)
all claims made prior to the effective date of this act and pending on
the effective date of this act.