The Insurance Act 2015

1st June 2015
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The above Act comes into effect in August 2016 and will be a big development for the UK insurance market as it will amend many principles that were laid down as long ago as The Marine Insurance Act 1906.

The Act will be principles-based as it is intended to allow flexibility in its effect and will modify and clarify aspects of insurance policies and processes that have been in existence for many years.

Although the new Act applies to both consumer and business-related policies, it will introduce a very important element in relation to businesses, known as the “duty of fair presentation”. This duty will be more structured than the long-established duty of disclosure that has been an inherent part of insurance contracts for many years.

(Consumer contracts are subject to The Consumer Insurance (Disclosures and Representations) Act 2012).

There will be much discussion and development prior to the Insurance Act coming into force in 2016, however, the intention of the Act will be to bring a fairer approach to the duty of disclosure of “material facts” and other information which forms the basis of a contract of insurance.

Remedies, following a breach of the duty of disclosure ,should be more fairly set out and more proportionate than the existing courses of action available to insurers. Significantly, the view towards policy warranties and conditions has been reviewed and a more pragmatic stance taken, for example, breach of a warranty will not automatically mean that a policy is considered to be invalid.

The Insurance Act will bring a number of changes for the industry and H&H Insurance Brokers will be keeping its clients informed about it as time progresses towards its implementation.

For more information contact Alan Green on 01228 406290.