If you are making a claim with your own insurance company for a loss (whether a homeowners’ claim, a Uninsured or Underinsured Motorist claim, or a medical payments claim) pursuant to the language of your policy, you have a duty to cooperate with your insurance company’s investigation. This cooperation may include giving a recorded statement, signing an authorization for your insurance company to obtain relevant medical records, submit yourself to an medical examination performed by a doctor of your insurance company’s choice, or to undergo a statement under oath (or SUO) which is an interview conducted under oath before a court reporter.
That is not to say you cannot retain an attorney to help guide you through the process, offer advice, and handle all of your communications with the insurance company. Before you submit yourself to a statement or medical examination, it is advisable you first meet with an attorney to determine if you would benefit from legal representation. Yan Kenyon offers free initial consultations, and we can determine together whether your claim or case warrants legal representation. Often times, Yan Kenyon can take insurance claims on a contingency basis, meaning you would owe no attorneys’ fees unless you recover from your insurance company.
On the flip side, when someone makes a claim on your insurance policy (e.g., if you are at fault for a car accident) you similarly have a duty to cooperate with your insurance company to help defend the claim. In this situation, your insurance company will provide you with an attorney, as part of your policy, if one is warranted.
If you do not cooperate, you risk your insurance company threatening to “pull coverage” — that is, render you responsible for paying any eventual judgment out of your pocket.
In Nevada, we have encountered situations where a third-party insurance company, against whom we are making a claim, has advised it is not extending coverage because its insured (the tortfeasor) is not cooperating. We have successfully argued that non-cooperation by an insured may not waive coverage for an otherwise insured accident.
NRS 485.3091(5)(a) provides:
Every motor vehicle liability policy is subject to the following provisions which need not be contained therein…The liability of the insurance carrier with respect to the insurance required by this chapter becomes absolute whenever injury or damage covered by the policy occurs. The policy may not be cancelled or annulled as to such liability by any agreement between the insurance carrier and the insured after the occurrence of the injury or damage. No statement made by the insured or on behalf of the insured and no violation of the policy defeats or voids the policy.
We have argued that post-accident conduct by a tort-feasor may not void coverage pursuant to NRS 485.3091.
The Courts that have addressed the issue have universally precluded insurance companies from citing lack of cooperation by their insured as a basis to deny-third party coverage when there exists a statute setting forth minimum coverage (such as in Nevada). See e.g., State Farm Mut. Auto. Ins. Co. v. Thompson 372 F.2d 256, 260 (9th Cir. 1967) (holding that to the extent of the limits required by the state law, “‘noncooperation’ is no longer a valid defense” in an action on an automobile liability policy); see also Royal Indem. Co. v. Olmstead, 193 F.2d 451, 453 (9th Cir. 1952) (“An exception to the general rule [requiring cooperation of an insured as a condition precedent to coverage] has been made in situations where the insurance policy was issued to satisfy the requirements of a statute having as its purpose the protection of the public.”)
Hence, it has been held that in states involving compulsory insurance, the insurer cannot cite lack of cooperation by the insured as a defense in a suit brought by an injured member of the public within the class sought to be protected by statute. That is, in states that require compulsory automobile liability insurance, an insurer cannot rely on the lack of cooperation by its insured as a defense in a suit brought by an injured member of the public, who, by definition is within the class sought to be protected by statute requiring a minimum financial responsibility. Royal Indem. Co. 193 F.2d at 453.
Nevada requires a minimum of $15,000 for bodily injury to or death of one person in any one accident. NRS 485.185. Thus, to the extent drivers are required to maintain at $15,000 in coverage, an insurance company cannot escape liability for that amount by claiming “non-cooperation” of its insured.
When an insurance company still refuses to extend coverage, even when faced with this legal analysis, we have successfully filed and litigated Complaints for Declaratory Relief, obtaining a judicial determination that there is insurance coverage for a particular accident.
