Duty of Disclosure

INTRODUCTION
The Insurance Contracts Act 1984 requires insurance companies to provide certain information to people intending to insure with them. The information concerns the duty of disclosure of an intending Insured and the effect of particular types of clauses in a proposed insurance policy. Where an Insurance Broker is involved in the transaction, the information is to be provided by the broker. The Insurance (Agents and Brokers) Act 1984 also requires us to inform you about some other matters where they are relevant to particular policies.

WHAT INFORMATION DOES AN INSURANCE COMPANY/BROKER HAVE TO GIVE YOU?
In general terms, the kind of information, which an insurance company/broker must give you, is as follows:

YOUR DUTY OF DISCLOSURE - CONTRACTS OF GENERAL INSURANCE SUBJECT TO INSURANCE CONTRACTS ACT
Before you enter into a contract of general insurance with an Insurer, you have a duty, under the Insurance Contracts Act 1984, to disclose to the Insurer every matter that you know, or could reasonably be expected to know, that is relevant to the Insurer's decision whether to accept the risk of the insurance, and if so on what terms.

You have the same duty to disclose those matters to the Insurer before you renew, extend, vary or reinstate a contract of general insurance.

Your duty, however, does not require disclosure of matter:

• that diminishes the risk to be undertaken by the Insurer,
• that is of common knowledge,
• that your Insurer knows or, in the ordinary course of his business, ought to know,
• as to which compliance with your duty is waived by the Insurer.

NON-DISCLOSURE
If you fail to comply with your duty of disclosure, the Insurer may be entitled to reduce his liability under the contract in respect of a claim or may cancel the contract.

If your non-disclosure is fraudulent, the Insurer may also have the option of avoiding the contract from its beginning.

Please note that your duty applies also when you seek to renew, extend, alter or reinstate a policy.