Rules covering disclosure by polilcyholders have changed, with the last part of the Insurance Contracts Amendment Act taking effect on December 28.

Contracts for most general insurance products are now classed as “eligible”.

The disclosure duty requires consumers to answer all questions honestly, while insurers cannot ask “catch-all” questions.

Before accepting a renewal, an insurer must ask if any information provided under original disclosure has changed. The insurer must also provide in writing the duty of disclosure requirements. It can ask more questions relating to the nature of the risk.

Insurers will be required to provide details of any previous disclosures, while policyholders have a duty to flag any changes.

If an insurer accepts an application or responds to a counter-offer within two months, it must also send the client a reminder notice on the duty of disclosure.

Failure to provide these documents will be seen as waiving compliance with the disclosure duty.