Non-Disclosure and Insurance Claims: What You Must Tell Your Insurer

The Legal Framework: CIDRA 2012 and the Insurance Act 2015

The duty to disclose accurately to insurers is not just an ethical obligation — it is a legal one. The applicable statute depends on whether the cover is taken out as a consumer or for business purposes.

For consumer insurance — including personal life, critical illness, and income protection policies — the governing law is the Consumer Insurance (Disclosure and Representations) Act 2012 (CIDRA), which applies across England, Wales, Scotland and Northern Ireland. CIDRA replaced the old, onerous consumer duty of "voluntary disclosure" derived from the Marine Insurance Act 1906. Instead of expecting consumers to volunteer everything a prudent insurer might want, CIDRA imposes a single, more balanced duty: to take reasonable care not to make a misrepresentation when answering the insurer's questions.

For business and commercial insurance, the parallel reform is the Insurance Act 2015, which imposes the wider duty of fair presentation of the risk. The two regimes share the same proportionate-remedy philosophy, but the duties themselves differ — most protection cover bought by individuals falls under CIDRA, not the Insurance Act.

Under CIDRA, the consumer policyholder must:

1. Take reasonable care not to make a misrepresentation — answering the insurer's questions honestly and accurately to the best of their knowledge
2. Answer the questions actually asked — the burden is on the insurer to ask clear, specific questions; you are not expected to volunteer information the insurer has not asked about
3. Make no deliberate or reckless misstatement — you cannot state something false even if you believe it to be immaterial

The standard applied is that of a reasonable consumer in the policyholder's position — not a higher professional standard. Questions asked by the insurer must be answered honestly and accurately.

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What Is a Material Circumstance?

A material circumstance is any fact or information that would affect the insurer's decision to offer cover or the premium and terms they would apply. The test is not whether the policyholder thought it was important — it is whether a prudent insurer would consider it relevant.

In the context of life assurance, critical illness, and income protection, material circumstances typically include:

Medical history: Any significant health conditions, diagnoses, treatments, or investigations in the past — the specific period asked about varies by insurer and question (commonly 5 years, sometimes lifetime). This includes conditions that have resolved, conditions you're currently managed for, and conditions under investigation.

Medication: Regular prescription medications can indicate underlying conditions even if no formal diagnosis has been made.

Mental health history: Depression, anxiety, eating disorders, and other mental health conditions are material if asked about. Many insurers now assess mental health history more carefully and proportionately, but it remains a required disclosure.

Family medical history: Insurers commonly ask about first-degree relatives (parents, siblings, children) who have suffered specified serious conditions — heart disease, cancer, diabetes, genetic conditions — before a specified age. If asked, this information must be disclosed accurately.

Hazardous activities: Regular participation in extreme sports, motorsport, aviation as a private pilot, scuba diving beyond recreational limits, or similar activities is material. Occasional one-off experiences are typically less relevant than regular participation.

Occupation: Hazardous occupations — working offshore, at height, with heavy machinery, in areas of conflict — can significantly affect underwriting. The specific occupation must be described accurately, including any particularly hazardous aspects.

Overseas travel: Extended travel to or residence in regions with elevated health risks can be material, particularly for income protection and critical illness policies.

Existing insurance: Particularly at high sum-assured levels, insurers may ask about other existing policies to assess aggregate financial exposure.

Criminal convictions: Both spent and unspent convictions may be relevant, depending on the specific application questions.

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The Old Law vs the New: How Remedies Changed

Before CIDRA came into force (for consumer cover) and the Insurance Act 2015 (for business cover), the consequences of non-disclosure — even innocent non-disclosure — were essentially binary. If an insurer could demonstrate that the policyholder had failed to disclose a material fact, they could void the policy from outset, regardless of whether the non-disclosure was deliberate or accidental and regardless of whether it had any connection to the claim being made.

This produced genuinely unfair outcomes. Policyholders who had simply forgotten a historical medical appointment, or who genuinely did not know their family member's diagnosis, could have valid claims declined in full.

For consumer policies, CIDRA introduced a proportionate remedy framework that turns on the nature of the misrepresentation:

• Deliberate or reckless misrepresentation: The insurer may void the policy from outset, decline all claims, and retain all premiums paid. The insurer may also seek damages.

• Innocent misrepresentation (the insurer would not have offered cover at all): The insurer may void the policy but must return all premiums paid.

• Innocent misrepresentation (the insurer would have offered cover on different terms): The insurer applies those different terms retrospectively. If cover would have been excluded for the undisclosed condition, the claim is declined for that condition. If cover would have been offered at a higher premium, the claim is scaled down proportionately — e.g. if the premium should have been 25% higher, the claim pays at 80% of the sum assured.

This proportionate approach is fairer but does not eliminate the consequences of non-disclosure. It remains entirely possible to have a claim substantially reduced even for innocent non-disclosure.

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How Insurers Investigate Claims

When a life insurance, critical illness, or income protection claim is made, the insurer will typically request the policyholder's full medical records from their GP and any treating hospitals or specialists. This is routine practice — it is not evidence of suspicion. For life insurance claims following a death, the records are typically requested from the deceased's GP directly.

Those records may reveal:

• Consultations or investigations that were not disclosed on the application
• Conditions that were being investigated but not yet formally diagnosed at the time of application
• Medications prescribed that were not mentioned
• Historical conditions that the applicant did not believe were relevant

The insurer then compares the medical records to the application form. If there is a discrepancy — even for something that appears unrelated to the claim — the insurer's underwriters will assess whether the undisclosed fact was material and what the underwriting decision would have been had it been disclosed.

This process happens after the claim is made. For life insurance, the policyholder is deceased, so the family is left to navigate a potential dispute at an already distressing time.

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Practical Guidance: How to Disclose Accurately

Answer Every Question Fully

Read each question on an insurance application carefully and answer it precisely and completely. Do not assume something is irrelevant — if the insurer has asked the question, they consider it relevant. If you are unsure whether something should be included, include it.

Consider Requesting Your Medical Records

Before making a life assurance application for a substantial sum, it can be valuable to obtain a summary of your GP records. This prevents the situation where your records reveal something you had genuinely forgotten. You can then ensure your application reflects everything in your records.

Under the UK's Access to Health Records framework (and GDPR), you have the right to access your own health records. Most GP practices now provide this through the NHS App or a practice portal.

Use a Specialist Broker

A good specialist protection broker serves as a buffer between you and the insurer at the application stage. They can help you understand which questions require which level of detail, how to present a complex medical history accurately and in the most favourable light, and which insurers have more sympathetic underwriting for specific conditions.

Importantly, a specialist broker can help you disclose difficult information — mental health history, historical substance use, HIV status — in a way that is accurate and complete but presents your current health status clearly. Non-disclosure is never the answer, but presentation matters.

Be Especially Careful with Inherited Conditions

Family medical history questions are commonly misunderstood. If your mother was diagnosed with heart disease at 64, that may be relevant even if the question asks about first-degree relatives diagnosed "before age 65". Check the specific wording of each question.

If a first-degree relative has a diagnosed genetic condition — BRCA mutations for breast/ovarian cancer, Huntington's disease, familial hypercholesterolaemia — this is almost certainly material on a life or critical illness application, even if you have never been tested yourself.

Notify the Insurer of Material Changes During the Policy Term

The duty of disclosure is principally a pre-contract obligation. Once the policy is issued, you do not generally need to notify the insurer of changes in your health. However, if you are asked to complete a new application — for example when increasing cover, converting a term policy to whole-of-life, or reinstating a lapsed policy — the duty applies afresh.

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The International Dimension

For clients with medical treatment histories across multiple countries — common for internationally mobile professionals — gathering complete medical records before making an application requires extra effort. GP records from foreign jurisdictions may not be automatically available to a UK or offshore insurer.

However, "I don't have access to my records from when I lived abroad" is not a defence against non-disclosure. The duty is to disclose what you know. If you know you received medical treatment overseas for a significant condition, you must disclose it. The insurer may or may not seek foreign records to verify it.

Offshore insurers operating from the Isle of Man, Guernsey, or Cayman Islands typically apply similar standards of fair presentation to their UK counterparts, though the specific regulatory framework differs.

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How Global Investments Can Help

Global Investments works with protection specialists who have deep experience in the underwriting process — including helping clients with complex medical histories make accurate applications that give their policies the strongest possible foundation.

We can connect you with advisers who:

• Review your medical history before application and identify what must be disclosed
• Present your case to insurers in the most accurate and favourable light without any misrepresentation
• Access specialist underwriters — including Lloyd's of London syndicates — for clients with conditions that standard insurers would decline or heavily load
• Advise on the appropriate market (UK domestic vs offshore) for your specific circumstances
• Ensure existing legacy policies are reviewed for potential non-disclosure issues before claims arise

The time to address non-disclosure concerns is before an application is made and certainly before a claim is filed. If you have any doubt about what your existing policies cover — or whether they were applied for accurately — a policy review is a sensible precaution.

This guide is for educational purposes only and does not constitute legal or financial advice. Insurance law and practice vary by jurisdiction. Always seek independent professional advice for your specific circumstances.