The Neptune rule

Understanding the Neptune Rule in New York No-Fault Insurance Cases

The Neptune rule represents a critical timing requirement in New York no-fault insurance law that can make or break an insurance company’s defense strategy. This rule establishes that insurance carriers must act promptly when requesting examinations under oath (EUOs) from healthcare providers seeking reimbursement for accident-related medical services.

Under New York’s no-fault insurance system, when a healthcare provider submits claims for treating auto accident victims, insurance companies have the right to require the provider to appear for an EUO as part of their investigation process. However, this right comes with strict time limitations that insurers ignore at their own peril.

The Neptune rule specifically requires that EUO requests must be sent within 30 days of the insurance company receiving the underlying claims. If an insurer fails to meet this deadline, any subsequent EUO request becomes a legal nullity—essentially worthless for defense purposes. This timing requirement protects healthcare providers from indefinite exposure to examination demands and ensures that insurance investigations proceed efficiently.

Jason Tenenbaum’s Analysis:

Wes Psychological Servs., P.C. v Travelers Ins. Co., 2019 NY Slip Op 52029(U)(App. Term 2d Dept. 2019)

“Contrary to defendant’s sole contention, defendant failed to demonstrate that it was entitled to summary judgment dismissing the complaint based on plaintiff’s failure to appear for EUOs, since the initial EUO request to plaintiff had been sent more than 30 days after defendant had received the claims at issue and, therefore, the requests were nullities as to those claims”

Key Takeaway

The Wes Psychological Services decision reinforces that timing is everything in no-fault insurance defense. Insurance companies cannot rely on late EUO requests to dismiss claims, regardless of whether the healthcare provider actually appears for the examination. When insurers miss the 30-day deadline, they lose a valuable defense tool and may face summary judgment in favor of the medical provider.