BUSINESSES in all sectors need to be aware of the new way in which the law now views the respective obligations of an insured business and its insurer, according to a broker in Emsworth.
Previously, insurers have been able to turn down claims when an insured business has not disclosed material facts, even when the insurer has not specifically asked for this information.
This ‘duty of disclosure’ ceased to exist on August 12 due to the new Insurance Act 2016.
Matthew Price, of Gauntlet Price in Emsworth, said this change had brought commercial insurance in England and Wales into the modern world, replacing the previous legislation, which was based on the Marine Insurance Act of 1906.
He said there was still a large responsibility on the part of business owners.
‘Businesses must present the information the law expects them to know, as part of their running of the business.
‘They may need to update internal systems, to ensure they provide this information as part of the insurance process, systematically document all heads of information required and nominate managers within the business who need to collate it.
‘They must also present information in a reasonable state and cannot expect the insurer to sift through piles of documents and extract the information themselves.
‘This law is all about transparency and, to achieve that, both parties need to play their part and have a dialogue.’
Gauntlet Price provides insurance protection and risk management services to a wide variety of businesses. Go to gauntletgroup.com