1. Your Duty to the Insurer
Before you buy, make changes to, or reinstate a consumer insurance contract, you will be asked questions by or on behalf of the insurer. Your answers will be used by the insurer to decide whether to insure you and on what terms.
1.1 You have a duty to the insurer under the Insurance Contracts Act 1984 to take reasonable care not to make a misrepresentation. To ensure you meet this duty, it is important that you answer all questions truthfully and accurately.
1.2 A misrepresentation is a false answer, an answer that is only partially true, or an answer that does not fairly reflect the truth.
1.3 This includes not telling the insurer something you know, or should know, is relevant to their decision to insure you.
1.4 As your insurance broker, National Cover will collect the information required by the insurer on their behalf. Any information you provide to us will be passed on to the insurer for their assessment.
Important: Your duty applies every time you apply for a new policy, request a variation, reinstate a lapsed policy, or renew your insurance.
2. Consequences of Misrepresentation
2.1 If you do not meet your duty and provide information that is not true and accurate, the insurer may be entitled to:
2.2 The remedies available to the insurer depend on what they would have done had you not made the misrepresentation, and whether or not it was fraudulent.
Fraudulent Misrepresentation
2.3 If your failure to take reasonable care not to make a misrepresentation is fraudulent, the insurer may refuse to pay a claim and treat the contract as if it never existed.
3. How to Meet Your Duty
3.1 When answering questions asked by or on behalf of the insurer, you must:
- Answer all questions honestly and to the best of your knowledge
- Take reasonable care to ensure your answers are accurate and complete
- Tell us if you are unsure about any answer
- Provide any information you know, or should reasonably know, may affect the insurer’s decision to insure you
- Notify us if any information changes before your policy starts or is renewed
3.2 Whether or not you have taken reasonable care will be determined having regard to all relevant circumstances, including:
- The type of consumer insurance contract in question
- How clear and specific the questions were
- How clearly the importance of answering questions truthfully was communicated
- Whether an agent or broker was acting for you
- Any particular characteristics or circumstances about you which the insurer was aware of, or ought to have been aware of
4. What You Don’t Need to Disclose
4.1 You do not need to disclose anything that:
4.2 If the insurer does not ask you about a particular matter, you are not required to disclose it unless you know, or a reasonable person in your circumstances would know, it is relevant to the insurer’s decision.
5. Who This Duty Applies To
5.1 Everyone who is insured under the policy has the same duty to take reasonable care not to make a misrepresentation to the insurer. This includes:
5.2 If you are answering questions on behalf of another person, the insurer will treat your answers as their answers. You should ensure they are aware of their duty and that any answers you give on their behalf are accurate.
5.3 If you fail to meet this duty on behalf of another person insured under the policy, it may be treated as a failure by that person.
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