Your Insurance Could Be Invalid

It was only at our annual insurance review meeting with our brokers (Churchill Insurance Consultants Ltd) that it was highlighted to me that the Insurance Act 2015 existed. Essentially the act deals with the non-disclosure of material facts in regards to insurance taken out by companies.  You will remember seeing the various generic questions that sit at the rear of any proposal form like: “have you ever been declared bankrupt” or “have you ever been declined insurance” etc.  These questions and others are there to tease out any material facts that have not already been disclosed.  However, the onus is on the insured to make sure that everything material is disclosed whether asked or not asked.  If you fail to disclose you may well not be covered. What is materiality?  This is information that had the insurer known may have influenced the insurer’s decision. Matters that are likely to be material that you should disclose:

• Details of any previous directorships where the company has failed.
• Plans to expand, sale or merge.
• Potential claims or problems.
• Any regulatory changes or impact
• Any HMRC investigations
• Any trading problems

This list is not exhaustive. This new act prevents you from relying upon “if the insurer does not ask do not tell”. As statutory auditors, part of our work is to review the adequacy of a company’s insurance and we will adapt our work to now consider the above. Should you have any concerns regarding your insurance then we would be happy to make introductions.  Wisteria is not an insurance broker and Wisteria cannot provide insurance advice.