It aims to give certainty to consumers and insurers alike by shifting the emphasis away from a consumer’s duty to disclose all necessary information, to a requirement for insurers to ask particular questions and obtain specific information about their customers before they issue an insurance policy.
This shift in responsibility should result in a reduction in any arbitrary or subjective repudiation based on unintentional non-disclosure.
Managing Director Nigel Payne comments:
“If passed into law, the Bill will lead to a need to capture full risk data about customers at the point of sale. This is common to pretty much every type of personal lines insurance with the exception of PPI.
"We’ve already recognised the need to align mortgage and income protection policies to the way in which personal lines products are underwritten and were the first to bring accident, sickness and unemployment cover underwritten at the point of sale to the market in January this year.
“We believe that our approach removes the ambiguity that has plagued ASU and it also means that there is no reason why any valid claim should be turned down.
"If this Bill results in the end of declinature based underwriting where a PPI insurer decides what it doesn’t want to insure and relies on claims decline clauses, this can only be a positive step forward for the PPI market as it starts to rebuild confidence and trust amongst consumers.”
