Last updated: 27 September 2022 Show
When a customer makes a claim, an insurer may find something which they think suggests that the customer misrepresented information when they took out a policy. The insurer might argue that if the customer had given true answers, it would have acted differently. As a result the insurer might:
Types of complaint we seeWhen we receive complaints, consumers tell us that:
Handling a complaint like thisWhen you receive a complaint about misrepresentation, you need to use The Consumer Insurance Disclosure and Representations (CIDRA) Act 2012. When a customer buys or renews an insurance policy, CIDRA says the customer needs to “take reasonable care not to make a misrepresentation”. When you’re deciding if a customer has taken reasonable care, you’ll need to think about:
If the customer didn’t take reasonable care and misrepresented some information that affected the policy, you’ll then decide whether the misrepresentation was careless or deliberate. If the customer did take reasonable care, then even if there was a misrepresentation, you can’t take any action against the customer. You should reply to your customer within eight weeks. If you don’t reply within the time limits, or the customer disagrees with your response, they can bring their complaint to us. We’ll check it’s something we can deal with, and if it is, we’ll investigate. We’ll expect you to be able to show us that you’ve investigated the complaint thoroughly and that you have reflected carefully on the circumstances. Find out more about how to resolve a complaint. What we look atWe want to know that you acted fairly if you decide there’s been a misrepresentation. So if a customer complains to us that they haven’t been treated fairly, we’ll consider your obligations under The Consumer Insurance Disclosure and Representations Act 2012 (CIDRA) and look at whether:
Putting things rightIf we decide you’ve treated the customer unfairly, or have made a mistake, we’ll ask you to put things right. Our general approach is that the customer should be put back in the position they would have been in if the problem hadn’t happened. We may also ask you to compensate them for any distress or inconvenience they’ve experienced as a result of the problem. The exact details of how we’ll ask you to put things right will depend on the nature of the complaint, and how the customer lost out. For example, if we decide that you’ve unfairly avoided or changed the terms of a policy, we may ask you to:
Find out more about how we award compensation. Case studiesConsumer complains when insurer cancels policy and declines claim because of misrepresentationBenjamin complains about his motor insurance policy being cancelled after his insurer said he made a misrepresentation when he took out the policy. Buildings insurance Subsidence Insurance Read more Consumer complains when insurer only pays 60% of claim because she did not disclose a previous burglaryFrancis complains after her insurer paid out less than she'd been expecting following a burglary. Contents insurance Theft Insurance Read more Insurer cancels home insurance policy and refuses claim for fire damageTilly complains about her insurer’s decision to “void” (cancel) her home insurance policy. Buildings insurance Insurance Read more Consumer complains about unfair price change in their insurance policyRalph contacted us about unfair price changes to his insurance policy after providing incorrect information. Insurance Pricing Distress and inconvenience Motor Insurance Up to £300 Read more Useful resourcesWhat must a policy owner provide to the insurer for validation that a loss has occurred?A Proof of Loss statement must be provided to an insurance company to show that a loss actually occurred. Which health policy clause stipulates that an insurance company must attach a copy of the application to the policy to ensure that it is part of the contract?
What is a request made to an insurance company by a policyholder?Claim - A policyholder's request for reimbursement from an insurance company under a home insurance policy for a loss to property. Claimant - A person who makes an insurance claim.
What is the initial requirement for an insured to become eligible quizlet?What is the initial requirement for an insured to become eligible for benefits under the Waiver of Premium provision? * under waiver of premium, which is a rider that will pay your premium while you're disabled, you must have a doctor certify that you meet the definition of disability as contained in the rider.
What is in the insuring clause?One is the insuring clause, in which the insurer agrees to pay on behalf of the insured all sums that the insured shall become legally obligated to pay as damages because of bodily injury, sickness or disease, wrongful death, or injury to another person's property.
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