The Insurance Act 2015 will apply to all commercial polices placed or varied after 12 August
2016. This document describes your duties, as a policyholder, in relation to The Act.
As a purchaser of insurance it remains your responsibility to disclose every material
circumstance that you know or ought to know about the risk. A material circumstance is
something that would affect the judgement of an insurer in deciding whether to accept the
risk and on what terms.
Through the creation of a new duty, the duty of Fair Presentation, the Act provides clarity
around what information you need to provide to the insurer and whose knowledge needs to
be captured when presenting a risk.
Any information you provide must be in a clear and accessible format. You do not need to
overload insurers with too much information. Information that is important should be
highlighted to ensure it is considered.
You must ensure that the information you provide is substantially correct and every material
representation about an expectation or belief is made in good faith. Matters which are
suspected must be substantiated; it is not acceptable to deliberately refrain from confirming
them or enquiring about them.
What you are expected to know will depend on the size and complexity of the risk you are
wishing to insure.
When collating the information about the risk you must involve people who know the risk,
can present the risk information and senior personnel who can sign the information off as
accurate. You must include the knowledge of the senior management team, the risk and
insurance team and the knowledge held by third parties e.g. accountants, solicitors and your
You will be expected to make a reasonable search of the information available in order to
make a fair presentation of the risk. What is reasonable will vary depending on the size of
your business but information includes information held within the organisation or held by
external parties such as those mentioned above.
If you are unsure that all material circumstances have been disclosed please discuss this
with us and/or your insurer. If put on alert, your insurer will make further enquiries to
ensure every material circumstance is revealed and your insurance is provided on the
correct terms and for the correct premium.
The duty of fair presentation has been created to ensure fairer outcomes in the event of a
claim. However, failure to make a fair presentation of the risk may result in the insurer
avoiding the policy and refusing all claims. Depending on the circumstances premiums may
not be returned.