Business Insurance

Insurance Policy Warranties

By November 14, 2017No Comments

Insurance policy warranties form part of the policy wording to ensure that a certain set of circumstances applies.

An insurance warranty, whilst it appears to be similar to a policy condition, is not. it is much more fundamental to the contract. Breach of a policy warranty will allow the insurer to avoid the policy completely, irrespective of whether the breach of warranty is connected to any claim or not.

The policy wording clearly defines any warranties in the terms that are used e.g “It is warranted that trade waste is to be swept up and bagged or binned daily and removed from the premises at least once a week.” specifies the minimum level of housekeeping that must be undertaken. In this case, this will be in place to avoid congestion and reduce any fire inception risk.

If this were simply a policy condition, then any claim unrelated to that warranty, perhaps a theft, would not be affected, but in the case of a policy warranty the insurer can avoid the claim.

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