You may have heard of the phrase “compulsory medical examination” if you’ve ever tried to file an injury claim in West Palm Beach. These exams are sometimes deceivingly referred to as “independent medical examinations.” Make no mistake, however: There is nothing independent about them.
Many insurance companies include a requirement for a compulsory medical exam before you are allowed to collect damages. However, under these terms, the insurance company picks the doctor. The insurance company pays that doctor. Some physicians earn hundreds of thousands of dollars annually solely conducting examinations for insurance companies, and then testifying about them in court. Make no mistake about where it is these doctors’ loyalties lie.
In the recent case of State Farm Mut. Auto. Ins. Co. v. Curran, an appellate court reviewing an underinsured motorist claim sided with the plaintiff, who refused to undergo a compulsory medical examination in order to collect for injuries she sustained in a crash.
According to court records, the case arose out of a traffic crash that occurred in June 2006. The plaintiff was reportedly rear-ended by an underinsured motorist. She and the underinsured motorist reached a settlement agreement, which was approved by State Farm, her insurance company. Through her attorney, the plaintiff indicated that her damages were estimated to be at $3.5 million, due to her diagnosis of reflex sympathetic dystrophy syndrome (RSD) type 1. However, she agreed to accept the company’s maximum underinsured payment limit of $100,000 if the company would tender it by the following months.
State Farm responded by contacting the plaintiff attorney to schedule a compulsory medical examination, pursuant to the terms of the policy. The policy does indicate that there is no right of action against the insurance company until all terms of the policy are met.
From there, the plaintiff’s attorney and the insurance company exchanged several contentious letters regarding the compulsory medical exam. Ultimately, the plaintiff declined to undergo an exam with a doctor chosen by the insurance company, despite warnings from the insurance company that her refusal to cooperate could result in a denial of coverage – which is what happened.
The plaintiff responded by filing a lawsuit. The insurance firm moved for a summary judgment on the issue of coverage, claiming that it was entitled to deny the plaintiff. She also filed a motion for summary judgment, indicating that a compulsory medical examination was not a condition precedent to coverage.
The plaintiff further purported that she did not refuse submission to a CME, but rather had asserted a series of reasonable requests in order to protect her own interests. These requests, she says, were ignored by the insurance company.
The trial court judge granted a summary judgment in favor of the plaintiff. The complaint then proceeded to a jury trial, where the plaintiff was awarded $4.6 million in damages. A judgment against State Farm was entered in the amount of $100,000, per the underinsured motorist policy limits.
The insurance company appealed. The Fifth District Court of Appeals determined that the plaintiff did act unreasonably by insisting that the insurance company abandon its contractual rights as a condition to examination, and therefore, she had breached the contract when she failed to undergo the scheduled CME. However, the court further found that in order to avoid liability on the claim based on noncompliance of the policy’s CME clause, it was up to to the insurance company to prove a material breach, or one that resulted in prejudice. The insurance company hadn’t met its burden, the appellate court ruled.
The Florida Supreme Court affirmed this decision, meaning that the plaintiff is entitled to collect her underinsured motorist damages.
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