Over the last few years the world of insurance has changed, and so have the agents, although you may not have seen. Before all you had to do was to install enough security systems to keep the specialists of the insurance company joyful and to speak to your broker once a year to whine about the increasing costs of the premium. The broker’s job would be to pressure the insurance companies to pay out to your client if there was a claim. The broker ironed out small wrinkles that could endanger the claim.
However, Marine insurance company are paying more attention to the small details to attempt to avoid paying out on a claim now.
What might seem to you as an ‘unimportant’ problem could cost you greatly in the function of a claim. That is called a ‘Material Fact’ and means that any fact, event or action that could materially impact your policy must be revealed to the insurance company.
For example, in the jewelry and diamond business, you use a new worker who’ll be taking about goods. Should you forget to notify your broker, in the unlucky event that jewellery or any diamonds are stolen, the insurance companies would be within their rights not to pay because there was a ‘non-disclosure of a material fact.’
You shouldn’t look on this as an obligation, it’s for your own good to notify your agents of anything useful or material or important that can impact your insurance. Whether it’s replacing your building front door, giving a painting to a gallery or having an “open house” in your store, you should speak to your broker ahead. After all, that’s one of the jobs of the broker and that’s what he is paid by you for.