Bill will make it harder for insurers to avoid claims
A long awaited shake-up of consumer insurance law that could make it harder for insurers to void claims has cleared the House of Lords.
The House of Lords has passed the Consumer Insurance (Disclosure and Representations) Bill. The bill will now receive its second Commons reading next Tuesday (24 January).
The legislation is designed to level the pre-contract disclosure playing field between consumers and insurance companies, making it harder to prevent claims being paid out on the grounds that the customer has provided accidentally inaccurate or misleading statements.
Under existing consumer law, defined by the Marine Insurance Act 1906, customers are required to volunteer information about everything that a “prudent insurer” would consider relevant.
Instead, under the new bill, the onus will be on insurers to obtain specific information about the customer by asking questions.
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