Before you enter into a contract of general insurance and up until the commencement of the insurance, you have a duty, under
the Insurance Contracts Act 1984, to tell the underwriter of anything that may affect the underwriters’ decision whether to insure
you and on what terms. You must tell the underwriter about anything that you know, or could be reasonably expected to know
taking into account the nature and extent of the insurance cover to be provided and the class of persons who would ordinarily be
expected to apply for such insurance cover.
For Eligible Contracts (Eligible Contracts involve individuals purchasing insurance for motor vehicles with carrying capacity under 2
tonne, motorcycle, home building and contents, residential strata, travel, personal accident and sickness and consumer credit) the
above duty only applies to questions asked of you by the underwriter. In answering any such questions you must tell them
anything that you know and that a reasonable person in the circumstances would include.
You have the same duty before you renew, extend, vary or reinstate an insurance contract. .You do not need to tell the
underwriter anything that:
– reduces the risk to be insured or that is of common knowledge;
– the underwriter knows or, in the ordinary course of business, ought to know;
– the underwriter has waived your duty to tell them about.
If you do not tell the underwriter anything you are required to, they may cancel your contract or reduce the amount they will pay
you if you make a claim, or both. If your failure to tell the underwriter is fraudulent, they may refuse to pay a claim and treat the
contract as if it never existed.