The Insurance Act 2015 came into force in August 2016, introducing new disclosure requirements for UK companies.
The Act aims to create a more level playing field between insurance buyers and insurers, and represents a significant change to UK insurance contract law. While insurance buyers face more rigorous disclosure requirements, the law makes it more difficult for insurers to void a claim on grounds of non-disclosure or breach of warranty.
The new law has yet to be tested in the courts, and disputes are expected to arise in coming years as insurers and insurance buyers seek clarity on certain provisions, such as fair presentation and how concepts like proportional remedies play out in practice.
All companies will need to review their risks with fresh eyes at each renewal and ensure a more thorough and properly conducted search, informing their brokers of any changes relevant to insurance, such as new products, suppliers, processes and territories.
In future, the ability to document and evidence the search for information and determine fair presentation will likely be central to successfully resolving disputes over claims.
The insurance industry is also still finding its way with regards to the Act. Most insurers have already amended their wordings to align with the Act, though future changes are likely as the law is tested in the courts.
Yet there are notable differences in approaches from insurers. Some insurers have offered customers little guidance. Other insurers are pro-actively using the Act as an opportunity to improve their offering and better differentiate themselves.
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