Insurance Act Reforms 2015 – what it means to you

The Insurance Act Reform 2015 will replace the Marine Insurance Act of 1906 – one of the most famous Latin policies in insurance was established within this Act, known to us as Utmost Good Faith.

The Act is to bring commercial insurance law up to date and fit for the 21st Century insurance market.

In essence, The Act seeks to clarify commercial insurance law in three key areas:

  • the pre-contractual duty of disclosure and the effect of representations at that stage
  • the effect of warranties contained in the policy
  • an insurer’s remedies for fraudulent claims (universal to both commercial and personal lines)

We welcome these changes as they create a greater level of trust between insurer, broker and customer, providing transparency and peace of mind for all parties.

What are the changes?

Act Changes
Act Changes

What are LV= Broker doing or going to do?

Duty of disclosure and representation

  • We’ve reviewed our policy wording for the purpose of misrepresentation to make it clearer and to meet the requirements of Act
  • We’re currently working with you and software houses to review question sets to align the provisions of the Act

Remedies for warranties within a policy

  • We’ve always used Conditions Precedent to Liability – breach of the condition must have had an impact/influence on the claim in order to be used as a defence in refusal of claims
  • We’re currently making some minor changes to the wordings in terms of basis of contract clauses

Remedies for fraudulent claims

  • Fraud conditions within Documents of Insurance have been reviewed and will be updated to reflect the requirements of the Act
  • Claims working practices, reference material and call guides around fraudulent claims will be updated as well as necessary internal training

We’ve already embraced Act and although it doesn’t come into force until August 2016, we’re confident the minor changes we do need to make will be seen by you and your customers much sooner.

For more information visit

Categories: Commercial Lines


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