Home insurance disclosure

[WorstPigeon]

I've just gotten home insurance for a new house. I initially phoned my bank for this; however they (or the insurer they use) would not quote due to the roof being flat. I then phoned another insurer who did quote (they had different guidelines on a flat roof, allowing concrete ones). I was happy with their quote, so took out insurance with them. On the question "have you had insurance declined, refused, cancelled or voided" I answered no.

Thinking about it after, though, should I have answered yes on this, on the grounds that the other insurer refused to quote? It's not clear to me exactly what "insurance declined/refused" means in this context. It doesn't seem like it should cover the case where an insurer wouldn't provide a quote, but I'm now worried that I should have mentioned it. Am I just being paranoid?

 

[odyssey06]

I personally would not have considered "not offering a quote" with "declined, refused, cancelled or voided".

I would be nervous about it only in a situation where the question that Company A asked that led to them not offering a quote was not asked by Company B.
Because maybe the question is buried somewhere in Company B's assumptions etc

If you had tried to claim with previous insurer for a roof issue though and the claim declined the claim, then I think you would need to declare that when going for a quote.
Or if you current insurer refuses to provide you with a renewal quote.

Also, I think if you find yourself in the situation where you are having difficulty getting cover at all, and you might need to the Insurance Bureau to get it, then it's very important for them to know who were the 1st, 2nd and 3rd companies you were declined by. But that might only be for Motor insurance.

 

[WorstPigeon]

I would be nervous about it only in a situation where the question that Company A asked that led to them not offering a quote was not asked by Company B.
Because maybe the question is buried somewhere in Company B's assumptions etc
.

In this case the question was "Is the house of standard construction", and both companies asked it; I asked both companies would the flat concrete roof be considered standard construction. Company A said it would not, company B said it would. Guidelines seem to differ on this; some companies only list slate and tile as standard for the main roof while others allow certain types of flat roofs, and weird stuff like metal roofs. Company A didn't have their guidelines on this available on the internet (at least not that I can find) or I wouldn't even have bothered ringing them to check.

 

[DirectDevil]

Sorry to go against trend here but I would be decidedly uneasy about this.

That question about "refusal" is open to interpretation. On a strict contractual interpretation there has been a refusal. Therefore, there is room for the argument that there has been misrepresentation of a material fact. The misrepresentation would be the negative answer about refusal of cover.

A material fact is defined as a matter that might influence the mind of a prudent insurance underwriter in deciding whether or not to accept a risk proposed for insurance and, if so, upon what terms and conditions. This can be interpreted quite strictly in favour of the insurance underwriter if a proposer leaves the way open. Insurance proposals are quite strict in nature.

No discourtesy intended here, but two golden rules apply in this type of situation ;

1. It is never the right of a person proposing for insurance to take it upon themselves to decide if a fact is material or not.
That is a judgment that lies within the remit of the underwriter.

2. Following the preceding argument - if there is a doubt about something, declare it.

I would not like to be trying to argue the fine line between refusal and the other possibilities if a major claim arose and the underwriters were trying to find a reason to avoid the policy.

We had a situation a few years ago where insurer X refused to quote us for the house because of one non-standard feature. We got insurance from insurer Y but I declared the previous declinature to keep it right and there was no problem. We complained to X about their decision. They made a mistake and accepted that they should have quoted. They also said that their refusal to quote would not be a material fact to be declared elsewhere. By training and background I knew that this was decidedly dodgy and poor advice and still declared the erroneous refusal to avoid future complications !

If I were in Worstpigeon's position I would feel vulnerable to a future refusal of indemnity, based on the misrepresentation issue, if there was a problem.

My inclination would be to regularise this with the current insurers. Put it to them that you "misunderstood" the refusal issue until it was pointed out by a friend and that you simply wanted to put the record straight for the avoidance of doubt. Do this in writing. DO NOT resolve this on the basis of a telephone call alone and be sure that you get written confirmation back that the situation is in order.

I would expect no problems as the current insurers were advised of and accepted the principal material fact relating to the flat roof. The problem is that refusal of a quote can constitute a material fact in it's own right.