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The Insurance Act is here

The Insurance Act 2015 (Act) is here, replacing the 110-year-old Marine Insurance Act 1906, which until now, governed contracts between businesses and insurers. Many industry insiders are hailing the Act as the most significant change to UK insurance contract law in more than a century.

So, what’s changed?

In summary, the following are the main changes:

  • New responsibilities for policyholders to provide all relevant information to underwriters 
  • Policyholders must involve all relevant senior management when compiling information for insurers
  • Insurers have new remedies for dealing with incomplete or dishonest disclosure
  • Warranties can only be used by insurers to avoid paying claims where they are directly relevant
  • Option for insurers to ‘opt out’ of much of the Act

What policies are caught by the Act and from when does it apply?

The Act applies to all commercial insurance policies commencing on or after 12 August 2016.

The Act also applies to policies commencing before this, but whose terms are varied after that date. So adding any assets, vehicles or people to a policy will mean that the new requirements will apply.

So what do I need to do?

Every customer is different and the new requirements will affect each business in different ways. The size and complexity of some businesses may also mean action is required well in advance of the implementation date.

When you first renew a policy under the new Act (or make an amendment once the Act is in force) you should take the time to carefully identify who within your business needs to be involved in gathering the relevant information.

You should also take into account changes to the information required by insurers, which now includes not only facts that you know, but those that you ‘ought to know’.

Your usual Clear contacts will be on hand during meetings or over the phone to advise and support you in adapting to the changes and are available to answer any questions you may have.

The following guide looks at the new requirements in more detail.

Please click to download the full guide

 

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