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Utmost Good Faith

You might be aware that when arranging insurance there is a duty on the proposer to disclose. A contract of insurance is of the utmost good faith or uberrimae fidei which means basically that insurers accept what you tell them – but beware, because I reckon that insurers are now using this to wriggle out of their responsibilities. For example, when I recently called Privilege to change some motor insurance, I was very careful to go through the car invoice precisely so that they were aware of exactly what was on the car – wouldn’t want them to squirm over the fact that I had not told them the car has metallic paint.

So I was rather pleased to learn that HM Government has introduced new rules to radically change the relationship between consumers and insurers. HM Treasury believes that  it will give certainty to consumers and insurers by shifting the emphasis from a consumer’s duty to disclose to a requirement for insurers to ask particular questions and obtain specific information about their customers, before they issue a policy. The current law has changed little since 1906, and with greater regulation the position has become complex and confusing for consumers. In other words consumers often would not know what needs to be disclosed.

It isn’t confusing for me – hopefully, these rules will make sure insurers play with a straight bat but otherwise just make sure that your insurer knows your inside leg measurement to avoid them maklng your policy void because you haven’t disclosed something that you could never have known needed to be so.

Cynical – moi?

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