ABI Statement of General Insurance Practice - Statement of General

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					                             Withdrawn 15 January 2005
                     Association of British Insurers

                       Statement of General
                        Insurance Practice


The following Statement of normal insurance            (e) So far as is practicable, insurers will avoid
practice applies to general insurances of                  asking questions which would require expert
policyholders resident in the UK and insured in            knowledge beyond that which the proposer
their private capacity only.                               could reasonably be expected to possess or
                                                           obtain or which would require a value
                                                           judgement on the part of the proposer.
   Proposal Forms
                                                       (f) Unless the prospectus or the proposal form
(a) The declaration at the foot of the proposal form
                                                           contains full details of the standard cover
    should be restricted to completion according to
                                                           offered, and whether or not it contains an
    the proposer’s knowledge and belief.
                                                           outline of that cover, the proposal form shall
(b) Neither the proposal form nor the policy shall         include a prominent statement that a specimen
    contain any provision converting the                   copy of the policy form is available on request.
    statements as to past or present fact in the       (g) Proposal forms shall contain a prominent
    proposal form into warranties. But insurers            warning that the proposer should keep a
    may require specific warranties about matters          record (including copies of letters) of all
    which are material to the risk.                        information supplied to the insurer for the
(c) If not included in the declaration, prominently        purpose of entering into the contract.
    displayed on the proposal form should be a         (h) The proposal form shall contain a prominent
    statement:-                                            statement that a copy of the completed form:-
    (i)   drawing the attention of the proposer to           (i)   is automatically provided for retention at
                the consequences of the failure                    the time of completion; or
                  to disclose all material facts,
                                                             (ii) will be supplied as part of the insurer’s
                   explained as those facts an
                                                                  normal practice; or
                     insurer would regard as likely
                        to influence the acceptance          (iii) will be supplied on request within a period
                         and assessment of the                     of three months after its completion.
                             proposal;                 (i)   An insurer shall not raise an issue under the
                                                             proposal form, unless the policyholder is
                            (ii) warning that if the
                                                             provided with a copy of the completed form.
                         proposer is in any doubt
                         about facts considered
                         material,     he    should          Claims
                         disclose them.
                                                       (a) Under the conditions regarding notification of
                          (d) Those matters which          a claim, the policyholder shall not be asked to
                           insurers have found             do more than report a claim and subsequent
                           generally to be material        developments as soon as reasonably possible
                            will be the subject            except in the case of legal processes and
                           of clear questions in           claims which a third party requires the
                           proposals forms.                policyholder to notify within a fixed time
                                                           where immediate advice may be required.
                             Withdrawn 15 January 2005



(b) An insurer will not repudiate liability to                     Commencement
    indemnify a policyholder:-
                                                               Any changes to insurance documents will be
    (i)   on grounds of non-disclosure of a material           made as and when they need to be reprinted, but
          fact which a policyholder could not                  the Statement will apply in the meantime.
          reasonably be expected to have
          disclosed;

    (ii) on grounds of misrepresentation unless it is
         a deliberate or negligent misrepresentation
                                                                   Policy Documents
         of a material fact;                                   Insurers will continue to develop clearer and
                                                               more explicit proposal forms and policy
    (iii) on grounds of a breach of warranty or
                                                               documents whilst bearing in mind the legal
          condition where the circumstances of the
                                                               nature of insurance contracts.
          loss are unconnected with the breach
          unless fraud is involved.

Paragraph 2 (b) above does not apply to Marine
and Aviation policies.

(c) Liability under the policy having been
    established and the amount payable by the
    insurer agreed, payment will be made
    without avoidable delay.



   Renewals

(a) Renewal notices shall contain a warning
    about the duty of disclosure including the
    necessity to advise changes affecting the
    policy which have occurred since the policy
    inception or last renewal date, whichever                      Disputes
    was the later.
                                                               The provisions of the Statement shall be taken
(b) Renewal notices shall contain a warning that               into account in arbitration and any other referral
    the proposer should keep a record (including               procedures which may apply in the event of
    copies of letters) of all information supplied to          disputes between policyholders and insurers
    the insurer for the purpose of renewal of the              relating to matters dealt with in the Statement.
    contract.




    The Association of British Insurers represents around 440 insurance companies, which between them account
    for over 95% of the business of UK insurance companies. The Association represents insurance companies to
    the Government and to regulatory and other agencies, and it provides a wide range of services to its members.

    L 249 August 1997 (Original printed January 1986)


                                      Association of British Insurers,
                                   51 Gresham Street, London EC2V 7HQ

				
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