Rainey Collins Lawyers

I Didn’t Know I Had To Tell My Insurance Company That!

By Alan Knowsley, Thursday, 22 May, 2008, Insurance

Dan had a nose-to-tail care accident, where he rear-ended another car causing major damage to his car and the car in front.  Dan thought “no big deal, it’ll be covered by my insurance” and exchanged insurance details with the other driver.  However, when it came to making his claim, Dan was shocked when it was declined.  He was faced with not only having to pay to fix his car … but also for the other car!

The problem was that Dan had received a speeding ticket the previous year and had not told his insurer when his policy came up for renewal.  According to the insurer Dan had failed to disclose a relevant event.  He had no idea that that was something he should have disclosed.  The claim was declined for ‘non-disclosure’.

Many of us are unaware of the type of information we need to give to our insurers.  To help out we have prepared a list of tips to help to ensure you do not lose the valuable protection that insurance is supposed to provide.

7 Tips To Ensure You Don’t Get Caught Without Cover

1. Never give false or incorrect information to an insurer.
2. Always provide the insurer with any information that you think may affect its decision to insure you.  This is otherwise known as all material information.  There is no distinction under the law between innocent or deliberate non-disclosure.  All that matters is that you didn’t tell them, and you should have.
3. If you don’t think something is relevant or you are unsure, tell them anyway.  It is better to over-disclose than under-disclose.  You have a duty of disclosure, which means they don’t even necessarily have to ask you.
4. Disclose new material information when you renew.  Insurers ask a whole raft of questions when you first sign up for a policy.  Your duty to disclose goes further than that list.
5. When renewing your policy, tell the insurer anything that has happened in the last year which could affect the renewal of the policy.  As in Dan’s case, for car insurance, this could be something like a speeding ticket, or something more severe like a drink driving conviction.
6. In the case of health insurance, income protection and life insurance … you also have to tell the insurer about anything that happens between you making the application and the insurance cover beginning.  This can be as simple as mentioning a doctor’s visit, or something more serious like developing a health problem.
7. Keep a copy of your answers to questions, and note everything else you disclose.  Remember to also record the date, and who you spoke to.  Then store that information with your policy documents to help reduce the risk of any problems in the future.

If you don’t disclose everything material to your insurance company, your insurance policy can be avoided (i.e. treated like it never existed).  This can affect other claims which you may have made under the policy and your ability to obtain insurance in the future.  The insurance company can even seek a refund on any money it has paid out to you for other earlier claims, as the policy is treated like it never existed! 

The consequences of non-disclosure can be devastating, so make sure you tell the insurance company everything you think could be relevant when you sign up to a policy, however minor.  Ensure that when your insurance company if any of your circumstances have changed.  To ensure that you are never caught without cover, we recommend telling the insurance company about your speeding ticket or other relevant events at the time they happen, rather than waiting for renewal.  It is better to be safe than sorry!

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