IMPORTANT INFORMATION ABOUT INSURANCE
Your Duty of Disclosure
To make an informed assessment of the risk and calculate the appropriate premium, your insurer needs information about the risk you are seeking to insure.
For this reason, before you enter into a contract of insurance, you have a duty under the Insurance Contracts Act 1984 to disclose to your insurer every matter that you know, or could reasonably be expected to know, is relevant to the insurer’s decision whether to accept the risk and, if so, on what terms. The duty also applies when you renew, extend, vary or reinstate a contract of insurance.
You do not have to disclose anything that:
• Reduces the risk to be undertaken by the insurer;
• Is of common knowledge;
• Your insurer knows, or in the ordinary course of its business, ought to know; or
• If the insurer has waived your obligation to disclose.
If you do not comply with your duty of disclosure, your insurer may be entitled to reduce its liability in respect of a claim or may cancel your contract of insurance. If the non-disclosure was fraudulent, the insurer may be able to avoid (or cancel) the contract of insurance from its beginning. This would have the effect that you were never insured.
One important issue to be disclosed is the history of losses suffered by the person seeking insurance or any closely associated person or entity. As you are responsible for checking that you have made complete disclosure, we suggest that you keep an up to date record of all such losses and claims.
If you have any questions about whether information needs to be disclosed to your insurer, do contact us.
You must also notify your insurer of any significant changes which occur while the policy is on risk or under negotiation. If you do not, your insurances may be inadequate to fully cover you.
We can assist you tell the insurer about changes and to ensure that your contract of insurance is altered to reflect those changes if necessary.
Sums Insured – Average and Co-Insurance
Some insurance policies require you to bear a proportion of each loss or claim if the sum insured is inadequate to cover the amount of the loss. These provisions are called ‘average’ or ‘co-insurance’ clauses.
If you do not want to bear a proportion of any loss, when you arrange or renew your contract of insurance ensure that the amount for which you insure is adequate to cover the full potential of any loss. If you insure on a new for old basis, the sum insured needs to be sufficient to cover the new replacement cost of the property.
Interests of other Parties
Some insurance policies do not cover the interest in the insured property or risk of anyone other than the person named in the contract. Common examples are where property is jointly owned or subject to finance, but the policy only names one owner or does not name the financier.
Please tell us about everyone who has an interest in the property insured so that we can ensure that they are noted on the policy.
Waiver of Rights
Some insurance policies seek to limit or exclude claims where the insured person has limited their rights to recover a loss from the person who was responsible for it, e.g. by signing an agreement which disclaims or limits the liability of the other party.
Please tell us about any contracts of this type which you have or propose to enter into.
If an insurer wants to rely on a term in an insurance policy which is not usually included in policies that provide similar cover, they must clearly inform you in writing of that term. Again, they may do so by providing you with a copy of the insurance policy.
Ian Hewitt and Associates Financial Services Guide - Updated 1 November 2018
Emergency Service Levy - Changes
NSW Government announced the abolishment of the Emergency Services Levy (ESL) currently levied on insurance premiums. Effective 1 July 2017, funding for Emergency Services in NSW will be collected through a property levy collected in conjunction with council rates, creating a fairer system for everyone.
What does it mean for you?
From 1 July 2017, customers will no longer pay ESL as part of their insurance premiums.
Which policies are affected?
All property and motor polices that carry a fire risk in NSW. This includes domestic home and landlord, domestic motor, commercial packages, farm, strata, general property, commercial property, construction and engineering, marine business and marina operators packages.
Click the PDF below for more information
Dated: 02 November 2018