Insurance is there to protect your business when things go wrong. But that protection relies on insurers having a clear and accurate understanding of the risks they’re covering from the outset.
When arranging or renewing insurance, businesses are required to provide a fair presentation of the risk. This means sharing any information that could influence an insurer’s decision to provide cover, set terms or determine premiums.
While this may seem straightforward, recent court decisions show that businesses can underestimate what insurers consider to be relevant information.
The recent case of Cometsambre SA v Lloyd’s Insurance Company SA (2026) HFW secures significant Commercial Court victory in key Insurance Act 2015 non-disclosure ruling | HFW highlights the importance of being fully transparent with insurers. The case involved a scrap metal trader that sought cover under its Charterers’ Liability policy following a significant fire-related claim. However, the insurer successfully argued that the policyholder had failed to disclose five previous fire incidents that occurred before renewal. As a result, the court found in favour of the insurer.
Key Takeaways for Businesses
- Disclose incidents even if no claim was made
The court confirmed that incidents capable of leading to a claim can be material, even where no insurance claim was ultimately submitted. Near misses, accidents, fires and similar events may still be relevant to underwriters.
- Changes in your risk profile are important
A sudden increase in incidents can be material, even if those incidents appear unrelated or have already been resolved. In this case, five fires over an 18-month period represented a significant change compared to the previous 12 years, during which no fires had occurred.
- Don’t assume insurers already know
The court rejected arguments that the insurer should have been aware of the risks involved. General industry knowledge does not replace a policyholder’s obligation to disclose specific incidents affecting their business.
- The responsibility to disclose remains with the insured
Even if insurers do not ask detailed questions at renewal, policyholders are still expected to provide a fair presentation of the risk. A lack of questions does not remove the obligation to disclose material information.
- Material information can affect cover
The insurer successfully demonstrated that, had the incidents been disclosed, it would not have renewed the policy on the same terms — or potentially at all. As a result, the non-disclosure directly impacted the validity of the cover.
What This Means for Your Business
When arranging or renewing insurance, it is important to share any incidents, losses, safety events or operational changes that could influence an insurer’s assessment of your risk. Being open and transparent helps ensure that cover remains valid and reduces the likelihood of disputes if a claim arises in the future.
Why Transparency Matters
If you’re unsure whether information is relevant, it’s always worth discussing it with your broker or insurer – if in doubt, disclose it. This judgment reinforces the importance of providing a complete and accurate picture of your business’s risk profile, not just details of previous claims. Early and transparent disclosure is one of the most effective ways to help protect your insurance cover when it matters most.
“Being transparent about risks, incidents or changes in your business helps us to protect you and ensure that there is cover available when it matters most”.
Hazel Downes, Head of Marine & Logistics
Call 01628 532613 for expert guidance on presenting your business risk clearly and accurately.
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