§ 36.3 Proof of Loss

• Library: Insurance Law in Oregon (OSBar) (2020 Ed.)

§ 36.3 PROOF OF LOSS

§ 36.3-1 Generally

The giving of notice of loss and proof of loss are separate obligations the insured must fulfill. Notice of loss is only preliminary in nature, informing the insurer that a claim will be filed and giving the insurer a chance to investigate what occurred. While proof of loss may also serve as notice of loss in some circumstances, notice of loss generally cannot serve as proof of loss. 44 Am Jur2d Insurance § 1351, Westlaw (database updated Nov 2019). Proof of loss must generally follow the policy requirements, which should be carefully reviewed.

In Oregon, the insurer must furnish proof-of-loss forms if a claimant submits a written request, but the insurer has no responsibility for the completion of the forms. ORS 742.053(1). In the case of individual health insurance, if claim forms are not given to the claimant within 15 days after he or she has given notice of the claim, the claimant, upon submitting written proof, will be deemed to have complied with the policy requirements for filing proofs of loss. ORS 743.426.

Proof-of-loss requirements for health insurance policies are set forth in ORS 743.429. Written proof must be filed within 90 days after the loss. But the statute further provides:

Failure to furnish such proof within the time required shall not invalidate or reduce any claim if it was not reasonably possible to give proof within such time, provided such proof is furnished as soon as reasonably possible and in no event, except in the absence of legal capacity, later than one year from the time proof is otherwise required.

ORS 743.429.

Casualty insurance policies usually require that written proof of loss be submitted "as soon as practicable" and that such proof must set forth the nature and extent of the injuries, treatment, and other details entering into a determination of the amount payable. Such proof of loss must be under oath if the insurer so requires. ORS 742.504(5)(a) (see discussion of examinations under oath at § 36.3-2(a) to § 36.3-2(e)).

In the case of fire and property insurance, the insured has 90 days after receipt of proof-of-loss forms to submit proof of loss. This is true even if the policy terms are more restrictive. ORS 742.053(2).

Care should be taken in noting the difference between the proof of loss required in a policy (which is traditionally a form provided by the carrier to be filled out in writing by the insured) and the proof of loss required by the attorney fee statute, ORS 742.061. ORS 742.061 generally imposes attorney fees on the insurer when the policyholder files suit and thereafter obtains more than what the insurer tendered within the first six months "after proof of loss." In Dockins v. State Farm Ins. Co., 329 Or 20, 26, 985 P2d 796 (1999), the court considered "what the legislature intended to convey in ORS 742.061 by its use of the term 'proof of loss.'" The insureds in Dockins suffered property damage due to a release of petroleum from a tank on their property. They contended that they had satisfied the statutory proof-of-loss requirement by filing a lawsuit against the carrier or, alternatively, by providing the carrier with cleanup estimates approximately a month later. The insurer countered that the insureds did not submit a proof of loss until they formally tendered defense in an administrative action by the Oregon Department of Environmental Quality, demanding cleanup, about six months after they had filed the lawsuit.

The Oregon Supreme Court determined that the statute's use of the term proof of loss "encompasses more than the ordinary, policy-based meaning [of the same term]." Dockins, 329 Or at 26. In defining proof of loss sufficient to satisfy the attorney fee statute, the court stated: "Any event or submission that would permit an insurer to estimate its obligations (taking into account the insurer's obligation to investigate and clarify uncertain claims) qualifies as a 'proof of loss' for purposes of the statute." Dockins, 329 Or at 29.

This holding was extended in Parks v. Farmers Ins. Co. of Oregon, 347 Or 374, 227 P3d 1127 (2009), which held that an initial phone call was a "proof of loss" for purposes of ORS 742.061. Thus, for purposes of ORS 742.061, a "proof of loss" is more akin to notice of loss, and is separate from the written requirement found in a policy and ORS 742.053.

§ 36.3-2 Examination under Oath

§ 36.3-2(a) Generally

If requested by the insurance company, the insured must submit to an examination under oath, so as to allow the insurer to determine its obligation and liabilities under the terms of the policy. Fowler v. Phoenix Ins. Co. of Hartford, Conn., 35 Or 559, 564-65, 57 P 421 (1899); Moore v. Allstate Ins. Co., 293 Or App 690, 429 P3d 1045 (2018), rev den, 364 Or 294 (2019). Oregon statutory law requires that the policy contain mandatory duties the policyholder must comply with so that the insurance company may adequately investigate a claim, including the provision for examination under oath. See, e.g., ORS 742.230.

Attending an insurance company's requested examination under oath is a condition precedent to coverage for the insured. Compliance with all conditions precedent to coverage is mandatory for an insured to bring suit. ORS 742.230; Loughlin v. Fireman's Ins. Co., 186 F2d 357 (DC Cir 1951).

In Moore, 293 Or App at 695, the Oregon Court of Appeals held that an examination under oath is a condition precedent to filing suit, and that the insured's refusal to attend a requested examination under oath barred the plaintiff from bringing the lawsuit. Similarly, in McBride v. State Farm Mut. Auto. Ins. Co., 282 Or App 675, 386 P3d 679 (2016), rev den, 361 Or 240 (2017), the court held that an independent medical examination (IME), if required by the policy, is a condition precedent to coverage, and that the insured's failure to attend a medical examination barred the plaintiff from bringing the lawsuit. McBride, 282 Or App at 690-91. Specifically, the court held that (1) a medical examination (if required by the policy) is a condition precedent to coverage, and failure to attend the requested medical examination bars the insured from bringing the lawsuit; and (2) no showing of prejudice is required because it was a condition precedent (as opposed to a condition of forfeiture such as the duty to cooperate). See also Shaban v. State Farm Fire & Cas. Co., 286 Or App 835, 398 P3d 507, rev den, 362 Or 281 (2017) (per curiam).

Even absent statutory authority, the insurer may write the policy to require attendance at an examination under oath as a condition precedent. Kachan v Country Preferred Ins. Co., 279 Or App...