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Claims notification

On several occasions recently, I have had to remind clients of the need to notify claims as soon as they are known about.

Indeed, it goes further than that and incidents that may lead to a claim should be notified to us as soon as you are aware of them. The last thing we want is for you to fall foul of a "claims notification" clause within your policy. Most policies will include this and this basically says that you must report any claims to the insurer as soon as possible.For property claims, this isn't really an issue as it is logical to report straight away. However, it is on legal liability claims where care must be taken.

A fairly typical scenario is one where an accident happens at work and an employee is injured. It may be a minor injury, or a more serious incident involving a RIDDOR report. Either way, the incident is noted in the accident book and the employee continues in their role, maybe after a period of absence. However, some months or even years down the line, quite often when the employee has now left your employ, a solicitors letter lands on your desk claiming compensation for their injuries. This is typically when you would inform your insurers of the incident.

The first question that insurers will ask, seeing the date on which the accident occurred will be, "why didn't you tell us of this when it happened?". Whilst I have yet to find an insurer refuse to indemnify due to late notification, the breach of the claims notification clause may allow them to do so, especially where they feel that their position has been prejudiced by not knowing.

Therefore, I encourage all clients, to think about informing us as soon as you are aware of the possibility of a claim. We can always note our file with an "incident" and will take a view on whether this should be reported to insurers or not.

Insurers would also be keen to point out that the reporting of incidents that have not yet given rise to a claim will not unduly affect your premiums. We will ensure that they are clearly aware, and are reminded at renewal time, that these are not claims, merely you, the policyholder, complying with your notification requirement!

Posted On 1 September 2010 | 0 Comments