Question 1

What is the difference between a warranty and a condition in an insurance policy?

Accepted Answer

The distinction determines **what happens when you get something wrong** — and in insurance these words carry technical meanings quite different from everyday use.

**Warranty.** A promise by the policyholder that something **is or will be true** — that a burglar alarm is fitted and set whenever premises are unoccupied, that a sprinkler system is maintained, that a vehicle is garaged overnight.

Historically, breaching a warranty **discharged the insurer from all liability from the moment of breach**, even if the breach had nothing to do with the loss. That produced notoriously harsh results — a claim for flood damage refused because an alarm was not set.

**The Insurance Act 2015 substantially reformed this.** Breach of warranty now **suspends** cover rather than terminating it, and cover resumes once the breach is remedied. More importantly, an insurer **cannot rely on a breach that could not have increased the risk of the loss that actually occurred**. The unset alarm no longer defeats the flood claim.

**Condition precedent.** Something that must be satisfied before the insurer is liable at all — typically procedural, such as notifying a claim within a stated period or not admitting liability. Failure can defeat the claim.

**Ordinary condition.** A term of the contract whose breach gives rise to a claim for damages but does not itself defeat cover.

**Representation.** A statement of fact made when applying — that you have had no claims in five years, that the property is not let. Under the Consumer Insurance (Disclosure and Representations) Act 2012, consumers owe a duty to take **reasonable care not to make a misrepresentation**. The remedy depends on whether the misrepresentation was **deliberate or reckless** — in which case the insurer can avoid the policy and keep premiums — or **careless**, where the outcome is **proportionate**: the policy is treated as it would have been had the truth been known, so the claim may be reduced rather than refused.

**Practically:** read terms describing what you must do or maintain, tell your insurer if circumstances change, and notify claims promptly.

General information, not legal advice.

Question 2

What is the difference between claims-made and occurrence-based cover?

Accepted Answer

Which policy responds — the one in force when the incident happened, or the one in force when the claim is made. It is the single most consequential distinction in liability insurance, and it

Question 3

What is typically excluded from a home insurance policy?

Accepted Answer

Exclusions are where most disputed claims originate, and the recurring theme is that insurance covers sudden, unforeseen events — not deterioration, maintenance or predictable consequences. Wear and

Question 4

What is the difference between an extended warranty and insurance?

Accepted Answer

An extended warranty is a service contract with a retailer or manufacturer. Insurance is a regulated contract of indemnity with an authorised insurer. The distinction matters because the protections

Question 5

What happens if my insurance company goes bust?

Accepted Answer

In the UK, the Financial Services Compensation Scheme (FSCS) exists for exactly this, and insurance is among the better-protected products — but the level of protection depends on the type of cover.

Question 6

What is a no claims discount and is it worth protecting?

Accepted Answer

A no claims discount (NCD), sometimes called a no claims bonus, is a reduction applied to your premium for each consecutive year you insure without making a claim. It builds up — commonly around 30%

Question 7

Why does delay in notifying a claim matter so much?

Accepted Answer

Because prompt notification is a condition of almost every policy, and late notification can reduce or defeat a claim that would otherwise have been paid in full. What policies typically require.

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