Many consumers consider insurance as somewhat of a grudge purchase, we would all prefer not to have to pay for it as many of us will pay premiums without ever, hopefully, having to use the service that we are paying for.
With this in mind, it is fair to say that many people fill out their proposal forms for insurance cover in a somewhat generous way by providing inaccurate information that will bring the premium down a little. In fairness to most consumers, many see this practice of omitting certain minor details as an innocent practice, but beware, your insurers and the wider insurance industry, including ourselves, do not.
Your proposal form is a contract, based on the principle of utmost good faith, between you (as opposed to the property insured) and your insurer. In times past, minor details missing from your proposal form were overlooked but recent economic trends have caused all businesses, including your insurance company, to take a much closer look at their activities. Your original proposal form is now a critical instrument in the processing of insurance claims.
One of the first things that your insurer will do after being informed of a claim is to closely examine your original proposal form and investigate its accuracy, the slightest omitted detail or untruth may lead to your claim being dismissed outright.
When ever you fill out a proposal form, we recommend that you talk to your broker if you are unsure of any details and always remember the principle upon which all insurance is based, utmost good faith.