Insurance—duty of disclosure

Published by a UU��ֱ�� Insurance & Reinsurance expert

Practice notes

Insurance—duty of disclosure

Published by a UU��ֱ�� Insurance & Reinsurance expert

Practice notes

This Practice Note considers the duty of fair presentation under the Insurance Act 2015 (IA 2015), which applies to non-consumer policies. For practical guidance on the duty of disclosure under consumer policies, see Practice Note: A guide to the Consumer Insurance (Disclosure and Representations) Act 2012. For further information on all aspects of IA 2015, see Practice Note: Insurance Act 2015 (IA 2015)—essentials.

Duty of ‘fair presentation’

Under IA 2015, s 3, the insured has a duty to make a 'fair presentation' of the risk to the insurer. The duty of fair presentation consists of three distinct elements:

•
disclosure: the insured must satisfy either the ‘primary’ or ‘secondary’ duty of disclosure:
1. ◦
  primary duty: the insured must disclose every 'material circumstance' which it 'knows or ought to know'. When deciding what an insured 'knows', it is the knowledge of those responsible for obtaining insurance on behalf of the insured or, alternatively, the senior management of the insured that is relevant. Further, an assured 'ought to know' something that would be revealed on a reasonable search of the relevant information

Jurisdiction(s):

United Kingdom

Key definition:

Duty of disclosure definition

What does Duty of disclosure mean?

When completing a proposal form for a protection product, the applicant has a duty to disclose all facts relevant to the application, particularly in relation to health. Failure to do so can allow the life company to refuse to admit a claim and cancel the policy from inception on the grounds of non-disclosure.

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