Taking out and maintaining a policyFAQs

It's the legal obligation on the policyholder — the client — to disclose to the insurer all known circumstances that could affect the assessment of the risk before the contract is signed. This declaration is usually made by answering a questionnaire provided by the insurance company or the intermediary. The insurer sets the terms — price, limits, exclusions — based on that declaration: an activity that's misdeclared can cause problems just when you need to use the insurance.

It's a professional or a company that acts as a link between clients and insurance companies. Their role is to advise the client, offer the policies best suited to their needs, and assist them in managing claims or dealings with the insurer. An intermediary doesn't have to make the premium more expensive: they're generally paid through a commission billed to the insurer, not the client.

Insurance brokers have greater professional capacity and qualification because the law — through the Directorate-General for Insurance and Pension Funds — imposes the strictest requirements in the sector on them: advanced technical training; independence from any insurer, with a legal obligation to carry out an objective analysis comparing multiple insurers in the market, without being tied to any of them; and specific financial guarantees and professional indemnity cover.

It happens when the sum insured is lower than the real value of what's being protected — for example, premises insured well below their rebuilding value. If, at the time of the claim, the sum insured is lower than the item's real value, the payout is reduced in the same proportion by which that sum undervalues it: this is the standard penalty for underinsurance, known as the proportional rule. Keeping sums insured up to date avoids this situation.

It's any written change to the terms and conditions originally agreed, added to the policy during its term: a change of address, an update to revenue figures, the appointment of a new director, a capital increase. It lets you adapt the policy to changes in your company without having to take out a new one.

It's the clause under which the policy renews automatically at the end of each insurance period, unless either party states otherwise within the period set out in law or in the contract. It's why it's worth reviewing renewal terms in advance, not only once the new annual period has already started.

It's a concept that's particularly relevant in professional indemnity or directors' liability policies. These policies usually work on a "claims made" basis: the retroactive date is the one stated in the special terms from which acts or omissions giving rise to a claim are covered, even if the claim itself is made while the policy is in force, and it can be earlier than the start of the current policy. Losing that date when switching insurers can leave past acts uncovered if they haven't yet given rise to a claim.

Send us the contractual requirement or the client's request. We'll review the policy to check whether it already meets what's being asked and, if necessary, we can arrange a certificate, clarification or amendment with the insurer. It's best to review the exact wording before assuming a requirement means taking out a new policy.

Yes, whenever the change could affect the insured risk. Taking on new activities, substantially increasing revenue, opening new locations, hiring more staff or changing the geographical scope of your business may require reviewing or updating the policy.

The relationship doesn't end once the policy is issued. During its term, changes in the company, requests for certificates, data amendments, new activities, revenue increases or questions about coverage can come up. Our team can help you manage these situations.