Your duty of disclosure with boat insurance

BUSH ‘n Beach has brought Nautilus Marine Insurance on board to expand the fine print and provide readers with clear, easy-to-understand and helpful tips on protecting their boating assets.

Your duty of disclosure
Truth is your best ally when it comes to insuring your boat. Its importance is wrapped up in a short but vitally important phrase, “duty of disclosure”. That phrase means you must disclose all relevant information to the insurer before you enter in a contract. What sort of information? Well, most insurance forms will assist you to identify relevant information by asking questions on the insurance application form such as: “Have you ever had any insurance refused or cancelled?”

“Have you made any boat or any theft claims in the past five years?” “Have you been convicted of any offence in the past five years?” But your duty of disclosure extends further than the three questions above which are typical of those asked on an insurance application form. Your duty also includes you telling the insurer everything you know and that a reasonable person in the circumstances could be expected to tell them, in answer to the questions they ask.

Let’s use an example from left field. Say you answered “no” to the above three questions because at the time of writing your answers, that was the case. However, if at the time of answering them you also knew you were going to court in a week’s time and would be pleading guilty to having committed an offence, then your answer of “no” clearly would be a failure on your part to be acting in good faith.

Such an answer may be ruled to be fraudulently keeping information from the insurer or held to mean that you deliberately misled the insurer. Were that to happen and some time down the track things went pear-shaped with your boat, that omission might provide sufficient grounds for the insurer to deny your claim or cancel your policy and treat it as if it never existed.

But what if you perhaps forgot to mention that eight months ago you failed a roadside alcohol breathalyser test and subsequently were convicted of exceeding .05 by the slimmest of margins.Your insurance policy again could be at risk if you fail to inform your marine insurer. It is your responsibility to disclose all such information each and every time you instigate or renew an insurance policy.

The good news is a specialist marine insurer such as Nautilus Marine is willing to discuss the circumstances of your particular case with you. You can phone Nautilus Marine and talk through your query and get a response on the likely impact that an event may or may not have on your insurance. If you are in the process of completing a form and are not sure what you should write in response to a question, it could be a good idea to attach an explanatory note detailing the circumstances.

For example, say two people jointly owned the boat and the insurance policy was in joint names. Further, one of those two policy holders was convicted of a drink driving offence but the other wasn’t. On a form that gives you a ‘yes’ or ‘no’ tick box, it would be difficult to explain the reality. Therefore, attaching a note explaining the circumstance would mean you were putting ‘all relevant information’ before the insurer in your application.

For people who own a boat together and are seeking insurance cover, it would be a good idea for them to fill out the form together. You don’t want to find out about your joint owner’s conviction only when the insurer advises you that your answers, filled in solely by you and in good faith, nonetheless have invalidated the policy because ‘old mate’ didn’t declare important information.

Finally, as with all insurance policies, always check your product disclosure document and if you have a query, ask for clarification. If you need further information, you can contact Nautilus Marine Insurance on 1300 780 533 for any boat insurance requirements.

Win a Nautilus Prize Package

Nautilus will also be answering your boat insurance questions of a general nature and will be offering a great bi-monthly prize to the best questions received. The prize is a Nautilus Marine merchandising pack comprising a collapsible chiller bag, a handy marine sports bag and a cap.

Just email your questions to qld@nautilusinsurance.com.au