They said you failed to disclose.
The law they quote changed in 2013.
As a consumer you do not have a duty to volunteer everything you can think of. You have a duty to take reasonable care not to answer their questions wrongly. That is a different thing — and a lot of refusal letters have not caught up.
Who's behind thisSteve Smart Helped people recover £25M+ from rejected claimsRe: Your claim
Dear ,
We have now completed our review of your claim.
You failed to disclose a material fact. We have therefore avoided your policy from inception and returned your premium.Had we been aware of this information, we would not have offered cover on the terms provided.Your duty of utmost good faith required you to disclose all material facts.The policy is void ab initio and no claim will be paid.
We therefore regret that we are unable to meet your claim on this occasion.
Yours sincerely,
Claims Department
What they mean
Avoidance is the most serious thing an insurer can do. It does not just refuse this claim — it treats the policy as though it never existed, returns your premium, and leaves you having to declare a voided policy every time you buy insurance again for years.
The stated reason is usually that something was not told to them: a previous claim, a medical condition, a modification, a conviction, who really drives the car.
Where it overreaches
Here is the thing worth knowing. The old law asked consumers to volunteer every "material fact" and to observe a "duty of utmost good faith". For consumer insurance, that was swept away in 2013. What replaced it is narrower and much fairer: a duty to take reasonable care not to make a misrepresentation in answer to the questions you are actually asked.
Yet refusal letters still arrive quoting "material facts" and "utmost good faith" — language that has not applied to consumer policies for over a decade. When a letter is arguing under the wrong law, that is not a technicality. It usually means the questions the law does ask have not been worked through at all.
And those questions are demanding. Was there a clear question? Did you fail to take reasonable care? Was it careless or deliberate? Would the insurer genuinely have done anything differently? Each one has to be answered before avoidance is available — and the burden of most of them sits with the insurer.
The counter-arguments
These are the points that put the burden back where it belongs. Not every one will apply to your case — the letter we write picks the ones that do.
Under the 2012 Act, a consumer’s duty is to take reasonable care not to make a misrepresentation when answering the insurer’s questions. There is no general duty to volunteer information nobody asked you about.
So the first question is direct: what exactly were you asked, and how? If they never asked, it is very hard to say you misrepresented — and a letter built on "you should have told us" rather than "you answered this question wrongly" is arguing under law that was repealed for consumers.
CIDRA 2012, s.2The remedy turns entirely on this. If the misrepresentation was deliberate or reckless, the insurer can avoid the policy and keep your premium. If it was careless — an honest mistake, a misunderstood question, a forgotten detail — the remedy is proportionate to what would have happened had they known: if they would have declined cover, they can avoid but must return your premium; if they would have charged more, the claim is reduced proportionately; if they would have imposed different terms, those terms apply.
Crucially, careless is the default. A misrepresentation is presumed careless unless the insurer proves it was deliberate or reckless. So a letter that jumps straight to avoidance while describing what sounds like an honest mistake has helped itself to the harshest remedy on the list without establishing the right to it.
CIDRA 2012, s.5 & Sch 1Not every inaccuracy counts. It only qualifies if the insurer can show that, but for the misrepresentation, it would not have entered into the contract at all or would have done so on different terms.
That is a specific, evidenced assertion about their own underwriting — not a rhetorical line. Ask them to demonstrate it. Underwriting criteria differ enormously between insurers, and "we would not have covered you" is a claim that has to be backed up.
CIDRA 2012, s.4Reasonable care is judged against the question you were actually asked, including how clearly it was put. Vague, compound, or ambiguous questions do not support strong remedies, and the standard takes account of the type of policy and how it was sold.
Ask for the question as presented at the point of sale — the screen, the script, the form. What was asked is often noticeably less precise than what the refusal letter now says was asked.
CIDRA 2012, s.3Insurers must handle claims fairly and must not unreasonably reject them, including by avoiding a policy. Avoidance in response to an honest, immaterial mistake invites exactly that challenge.
It is also worth spelling out the consequences to them in writing. A voided policy follows you around for years, and the disproportion between an honest slip and that outcome is itself part of the argument.
FCA ICOBS 8.1.1RSources: Consumer Insurance (Disclosure and Representations) Act 2012 · FCA Handbook — ICOBS 8.1 (claims handling)
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Questions
It is the allegation that you failed to tell your insurer something they needed to know — a past claim, a medical condition, a modification, a conviction.
For consumer policies the legal framing changed in 2013. The duty now is to take reasonable care not to make a misrepresentation when answering the questions the insurer asks, rather than to volunteer every material fact.
Not automatically. They generally have to show you were asked a clear question, that you failed to take reasonable care in answering it, and that they would have acted differently had they known.
And an honest mistake is treated as careless, not deliberate — which usually means a proportionate remedy rather than avoidance. Careless is presumed unless the insurer proves otherwise.
For a consumer policy, that language is out of date. The duty of utmost good faith and the duty to disclose material facts were replaced for consumers by the Consumer Insurance (Disclosure and Representations) Act 2012, which came into force in 2013.
A letter still arguing on that basis is often a sign that the questions the current law does ask have not been addressed at all.
It decides what the insurer is allowed to do. Deliberate or reckless means they can avoid the policy and keep your premium. Careless means the remedy has to match what they would have done had they known — return the premium, reduce the claim proportionately, or apply the terms they would have set.
The law presumes carelessness. It is for the insurer to prove deliberate or reckless if that is what they are alleging.
It means treating the policy as if it never existed, rather than simply cancelling it going forward. Your premium is usually returned and no claim is paid.
It is the most serious step available to an insurer, and it has consequences well beyond the claim — you will normally have to declare a voided policy when buying insurance for years afterwards.
No. smarterclaims publishes legal information and writes letters you can send yourself — like a digital version of a published legal guide. We are not a law firm and we do not give advice.
If your case needs professional representation, we will tell you, and we can introduce you to the right people if you ask us to.
Checking whether you have a case is free. You see the analysis and the arguments before you pay anything.
The rebuttal letter is £49.99. It comes with an explanation of where you stand and a step-by-step plan.
There is a no-questions-asked money-back guarantee. If the pack is not useful, tell us within 14 days and we refund you in full.
It should not, and firms are required to handle complaints fairly. Insurers deal with complaints as routine business — a well-argued letter tends to be taken more seriously than an angry phone call, not less.
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Meet Steve Who's behind this
Forty years inside the insurance industry, in both senior legal and commercial roles. Former UK General Counsel at AIG. Current Chairman of Lancashire Insurance UK. Regular voice on LBC radio. Steve has watched the same disputes come up again and again — and built the library of arguments that smarterclaims runs on, based on his decades of experience.
“I've spent forty years on the inside of insurance. The same excuses come up again and again, and most consumers don't know how to overcome them. This is the tool I wish my clients had before they called me.”Steve SmartMore about Steve
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