Key Takeaway
Court clarifies insurer's right to request verification and IMEs before claim payment deadlines begin running in New York no-fault insurance cases.
Understanding Insurer Rights to Verification and IMEs in No-Fault Claims
In New York’s no-fault insurance system, timing is everything. Insurance companies must pay or deny claims within specific timeframes, but what happens when they need additional information first? A recent Appellate Term decision clarifies an important principle: insurers can request verification, including examinations under oath (EUOs) and independent medical examinations (IMEs), without triggering their obligation to pay or deny claims immediately.
This case demonstrates how New York No-Fault Insurance Law protects insurers’ ability to investigate claims thoroughly. The decision reinforces that verification requests — whether for documents, testimony, or medical examinations — effectively pause the payment clock until the insurer receives what it needs to make an informed decision.
The ruling is particularly significant for medical providers who may assume that IME no-shows automatically favor their position. As this case shows, courts will examine whether proper procedures were followed before determining the consequences of a missed examination.
Jason Tenenbaum’s Analysis:
Avalon Radiology, P.C. v Global Liberty Ins., 2020 NY Slip Op 51374(U)(App. Term 2d Dept. 2020)
“As this court has held, where an insurer timely requests verification, its time to pay or deny a claim does not begin to run until it has received all of the requested verification, including the conducting of an EUO, and the insurer need not deny a claim while it is waiting for requested verification even if it already has a basis to deny such claim (see Parisien v Citiwide Auto Leasing, 64 Misc 3d 132, 2019 NY Slip Op 51050 ; Active Care Med. Supply Corp. v American Tr. Ins. Co., 61 Misc 3d 138, 2018 NY Slip Op 51584 ; Alev Med. Supply, Inc. v New York Cent. Mut. Fire Ins. Co., 38 Misc 3d 143, 2013 NY Slip Op 50258 ). As a result, the Civil Court’s holding that defendant was precluded from denying the claims based upon the assignor’s failure to appear for IMEs was erroneous. As no testimony was taken, the matter must be remitted to the Civil Court for a new trial.”
Key Takeaway
The Appellate Term confirmed that insurers can request verification, EUOs, and IMEs without starting their payment timeline. Even when insurers have grounds to deny a claim, they’re not required to do so while waiting for requested verification. Courts must carefully examine procedural compliance before ruling on IME no-show consequences.
