When taking out an insurance contract, the policyholder is obliged to accurately describe the risk (declaration obligation). The description must allow the insurer to assess the risk and therefore accept or reject it. If the risk is accepted, the insurer will take this description of the risk into account in determining the premium.
In order to better identify the risk, insurers sometimes use questionnaires which the policyholder must answer truthfully.
Please note! It does not exempt the policyholder from voluntarily mentioning any element which, in his opinion, could influence the assessment of the risk both when the insurance is taken out (and during the course of the contract). The consequences - especially financial - of failing to declare the risk correctly are considerable. Think about it!
For the duration of the contract - e.g. in the event of a claim - the insurer may discover that the risk was not correctly communicated to him. What does the law provide for in such cases?
- In case of fraud, intentional omission or intentional misrepresentation, insurance law is unequivocal: the contract is void and the premiums due are forfeited. There will be no compensation.
- This incorrect declaration may also be unintentional, e.g. following a claim, the fire insurer discovers that the house is equipped with a coke boiler or that the apartment is located above a chip shop: the contract is not null and void, but the insurer can either offer to adjust the premium or terminate the contract, if it proves that it would not have insured the risk under any circumstances.
With regard to compensation for a claim arising before the amendment of the contract or the annulment tookeffect, the law makes the following distinctions:
- the incorrect declaration of risk cannot be attributed to the policyholder: the insurer must provide the agreed cover;
- the incorrect declaration of risk can be attributed to the policyholder: the insurer is obliged to provide the cover only in accordance with the ratio between the premium paid and the premium that would have had to be paid, if the declaration had been correct;
- if the insurer proves that it would never have insured the risk, the actual nature of which is revealed by the claim, the cover shall be limited to a refund of all premiums already paid.