Help make sure your cover is right for your organisation
Arranging insurance for your organisation is a big responsibility and it's important to get it right. This article highlights the importance of accurate cover and key aspects of the Insurance Act 2015. It stresses the need for detailed information about your property and risks, and outlines obligations including fair risk presentation and full disclosure. Being transparent and clear is essential to protect your organisation.
Why we need all the details
Insurance is different from other products. It is based on ‘utmost good faith’, which means being truthful and honest at all times. So, you must make sure that you give us all the important details about your property and your risk at every step:• Before your policy starts
• Every time you renew your policy
• Whenever you change or extend your policy
• If there’s ever a change in any of the risks you have told us about
Your obligations under the Insurance Act 2015
The Insurance Act 2015 was designed to make insurance clearer – for both the insurer and the organisation taking out cover. At Zurich, we make sure we adhere to the Act and we want to help our customers comply with it too. Let’s take a look at four obligations that you need to follow:
a. Give us a ‘fair presentation’ of your risk
The Insurance Act 2015 says that insurance policyholders must provide a ‘fair presentation’ of their organisation and the assets they need to insure. So, you need to be totally transparent about all your risks and, if anything changes, you must let us know. This is your duty as a policyholder, and it applies throughout your policy with us.
Here’s how the Insurance Act 2015 explains how to give a fair presentation of your risk:
• Disclose everything that your senior management knows or ought to know. ‘Senior management’ refers to anyone who makes significant decisions about how your organisation is managed.
• Disclose everything known by the people who are responsible for arranging your insurance. This includes risk managers and any employees who help collect data or negotiate insurance terms.
When you’re giving us information or filling in a form, you must make sure everything is accurate and complete. If something could affect your insurance, you need to tell us – even if we don’t ask about it directly.
b. Carry out a ‘reasonable search’ of risks
The Act also requires you to carry out a ‘reasonable search’ to find all the material circumstances that could affect your insurance. You should look at information:
• From within your organisation
• Held by your agents
• Held by people or organisations covered by the insurance
You must present the information in a way that is clear and accessible to the insurer, avoiding any misrepresentation or ‘non-disclosure’, which is when you fail to share information.
c. ‘Signpost’ key information
The Act also says you must use ‘signposting’. This means you have to draw our attention to key information or let us know if we need to ask for more details. Organisations can’t hide important details in a long document or swamp their insurer with lots of data. In a nutshell, you have to make the important points clear and easy to find.
d. Make a full disclosure
You also have to disclose everything that could influence an insurer’s decision, even if it won’t necessarily lead to a higher premium or a policy refusal. When in doubt, disclose it. If you don’t, your insurer might end up reducing the payment on a claim, applying additional terms, not paying a claim at all or even cancelling your policy.
To sum up, transparency is the best policy
When we are considering whether we can insure your property, we need to make sure we have all the facts that are ‘material to a risk’. That means all the information that could affect our judgement when deciding whether to accept a risk and working out the premium you’d need to pay.
In line with your obligations the Insurance Act 2015, we expect all of our customers to carry out a reasonable search of your organisation and make sure to signpost any details of a risk that we’d need to know more about. And if you’re unsure about anything at all, please let us know. We may ask you questions about your level of cover just so we understand what you need – and also to make sure that you’re not insuring for more than you need to.
We’re here to help
We want to make sure that your insurance policy works for your organisation, and that you find it easy to deal with us. If you need any more information or support, please get in touch and we will do what we can to help.
