We have presented, lectured, workshopped, written, blogged (obviously) and listened very extensively on the Insurance Act 2015. Many questions and concerns and much of the press coverage and other commentary has centred around the duty of fair presentation. Will this be the area of substantial dispute, as theory is applied to practice, and claims start to test “Insurance Act” policies that were written from 12 August 2016?
The question that should be addressed is whether it is this part of the Act that, although widely discussed, is more contentious than other areas. The answer, because lawyers always caveat, is that there will certainly be disputes.
The first area of concern is around the “threshold test” for the policyholder to provide “sufficient information” which puts the insurer on notice to raise questions. Although this does mirror “waiver” issues under the old law one can envisage that there will be disputes. Secondly, the duty of fair presentation does preclude “data dumping” with the wholly new requirement that a fair presentation must be in a “clear and accessible format”.
Does “wholly new” mean “wholly contentious”? In fact, whilst we can anticipate some litigation around the issues “fair presentation” will not, we predict, prove to be area of substantial dispute. In the first instance there is the practical control that an underwriter can exercise to decline to offer terms when “data dumped”.
Additionally, and of benefit to the policyholder there is the corresponding question that might prove difficult for the underwriter to answer if the defence is subsequently raised: “Why did you offer terms if you were not happy with the format of the presentation?” It is likely too that the issue of “clear and accessible” will be a question of fact at first instance and will not often trouble the higher Courts.
The issue of “fair presentation” itself does carry greater scope for dispute of course. There will be arguments around the “sufficiency” of disclosure and underwriters enquiries but there is some case law for guidance which should assist. Thus, referencing Elvis again, we conclude: pre-commencement aggravation and less (satisf)actioning me!
Written by Terry Renouf, partner, BLM