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What it means for intermediaries

When does the Act apply?

The Consumer Insurance (Disclosure and Representations) Act 2012 became effective from 6 April 2013. It applies to consumer insurance purchased by individuals ‘wholly or mainly for purposes unrelated to their trade, business or profession’, and not commercial customers.

What are the key points of the Act?

The key takeaway from the Act for insurers and intermediaries centres on misrepresentation.

The Act removes the duty on consumers to volunteer information to an insurer and replaces it with one to take reasonable care to ensure that the questions asked by an insurer are answered honestly and reasonably.

How does the Act affect me and my business?

We know that many of you are in the course of reviewing and making changes to your own documents and processes to ensure they remain fit for purpose.  Like us, most of the principles embodied by the Act will already be thoroughly embedded within your own TCF values and in many respects the Act does no more than articulate existing best practice. 

The ABI guidance clearly states that defaulting of answers, or the use of assumptions, can lead to misrepresentation. As you continue to help your customers to provide this accurate and honest information in their answers to the questions we ask, instances where the remedies available under the Act have to be called upon can be kept to a minimum.

Further information on the Act can be found by visiting:

We’ve put together some guidance in our latest BrokerBox insert, ‘Type, not tab!’ This lists some of the commonly defaulted software house data fields and gives some handy tips for getting more accurate answers from your customers.