Given the role of insurance is to pay out on the day, it really matters if a claim is rejected. Rod Smith, a Chartered Insurance Institute trainer, discusses the anguish of having to tell a client that their policy is in fact void. The Insurance Act 2015 aims to reduce the commonality of this situation and is an opportunity for insurance brokers to really add value to their client relationships.
Clients may find The Insurance Act difficult to understand and given the onus is moving onto them, brokers will need to effectively guide them through the new regulations.
Rod Smith discusses the issues that The Insurance Act 2015 aims to address including failing to disclose material facts and the insured being in breach of a term or condition.
Brokers will need a thorough understanding of the new terminology to provide the best service for their clients in light of the laws.
The Insurance Act 2015 contains a number of phrases which aren't necessarily easy to understand, Rod talks about the 'Duty of fair presentation' and how the onus has moved from the insurers to the insured.
As an insurance broker it is vital to understand the key terms of The Insurance Act to ensure you can provide the correct guidance to your clients, otherwise you could find yourself in an unfavourable situation which could have been avoided.
The Insurance Act 2015, Part 3: Warranties and other terms (Page 5). Section 10 and 11 of the act will allow the insured to appeal the refusal of a claim by showing the insurers that any breach of the policy, did not in fact increase the risk of the loss.
Rod highlights the opportunity for insurance brokers to add significant value by reacting quickly and effectively, including potentially the use of forensic scientists to back up a claim.
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