Insurance Act Comes into Force

The Insurance Act 2015 received Royal Assent on 12 February 2015 and comes into force today, on 12 August 2016.  It represents the most significant change to insurance contract law in this country for over 100 years.

The aim of the legislation is to create a new and fairer balance between policyholder and insurer. The main provisions of the Act give effect, with some modifications, to the recommendations made in July 2014 by the Law Commission and Scottish Law Commission.

Amongst other things the Act deals with:

• Duty of disclosure, both before a contract incepts and when amended

• Warranties (including basis of contract clauses)

• Terms not relevant to the actual loss

• Fraudulent claims by insureds

The changes will have a significant impact on how insureds and insurers approach policies, creating new duties for insurers and policyholders to comply with. 

Whilst there will no doubt be challenges and a natural period of settling in to the Act’s provisions, as precedents are established, We at Keen Insurance welcome the Act in the spirit it has been launched and our clients can rest assured that we will keep up to date on the changes and how it will affect their policies going forward.

If you have any queries regarding the Act and how it may affect your businesses’ insurance policies please don’t hesitate to contact us.