Case Review: Insurance
Summary of some of the decisions made by the Mediators on some of the complaints received by FMB.
This summary is for information only and should not be used for other purpose.
FMB/GI 0480 - Non-disclosure of Previous Loss
The insurers declined the insured's claim for the loss of the insured vehicle on the ground that the insured failed to disclose in the proposal form about his previous loss.
It was observed that apart from the name of the insured written down on the space for 'signature of proposer', the proposal form was not filled in. The Mediator was perturbed by the insurers' action in issuing a policy based on uncompleted proposal form. According to section 150 (3) of the Insurance Act 1996 where a proposer fails to answer or gives an incomplete or irrelevant answer to a question contained in the proposal form and yet the insurers issue a policy without further inquiry the insurers can be said to have waived the non-disclosure.
In any event, Question 1(a) of the proposal form only requires the proposer to disclose any claim made during the past three years. According to the insured's statement to the adjuster his previous loss occurred in 1999. When an insured is asked a question with reference to a specific time frame, it is generally accepted that the insurers have waived disclosure of similar information which falls outside such a time frame.
Upon being queried the insurers revised their decision and settled the claim