Waiving Your Duty to Disclose Can Leave You Uninsured

Waiving Your Duty to Disclose Can Leave You Uninsured

Don’t be like 19% of other Canadians who lie on their insurance applications. Respect your duty to disclose and tell your insurer the truth. Contrary to popular belief, lying can cost you money—not save it.

How Many Canadians Lie to Their Insurers?

According to a 2012 consumer’s poll, one in five Canadians omit details on their policy. They fib about their annual mileage, parking location, primary driver, and accident history. More than 40% get caught and pay dearly for it.

Another survey found that 34% of American drivers falsify their insurance applications. Consequently, more than half of offenders face severe financial repercussions.

Waiving Your Duty to Disclose Can Leave You Uninsured

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The Consequences of Non-Disclosure

Lying to your insurance company can void your policy outright. The details that you omit ultimately influence the coverage you’re approved for and at what premium. Regardless if a claim relates to the suspect part of your insurance, lying affects the whole policy.

Of course, non-disclosure comes in many forms. The consequence per situation varies, but it is your duty to always ensure transparency and honesty. Here are four common types of delinquency.

  1. Deliberate:You hide or skew information to receive a better premium.
  2. Reckless:You do not take your application seriously and fail to verify your answers. Worse, you leave it to another person to complete and submit on your behalf.
  3. Innocent:You falsify your information because you misinterpret the questions or find them ambiguous.
  4. Inadvertent: You lie or omit a detail without breaking good faith. Although negligent, the intent was not malicious.

It is hard to distinguish inadvertent non-disclosure from recklessness. The difference, however, can affect the outcome of a claim. Similarly, innocent non-disclosers often end most favourably. At best, the case becomes refutable, and you get the opportunity to correct your mistakes.

Nevertheless, honesty is the best policy when filing for insurance. Don’t get caught in a lie; it will affect your premium and eligibility for renewal or approval. The few dollars you might save is just not worth it.