Many home insurance policies attach security conditions to cover: keep the alarm set when the house is empty, use approved locks, fit window locks, or keep valuables in a safe. A householder who breaks one of these terms can worry that any later claim will be refused, even when the security lapse had nothing to do with the loss. Part 3 of the Insurance Act 2015 limits what insurers can do in that situation. The relevant sections carry a UK extent marking on legislation.gov.uk. This article explains sections 10, 11 and 15 and the Explanatory Notes that accompany them. It is general information, not legal or insurance advice, and the wording of an individual policy always matters.
Warranties: suspension, not the end of cover
A warranty is a term that has to be complied with exactly, whether or not it is material to the risk. Before the 2015 Act, breaching a warranty discharged the insurer from liability entirely from the moment of breach. Section 10 abolishes that rule. Instead, under section 10(2), the insurer has no liability for a loss occurring, or attributable to something happening, after a warranty has been breached but before the breach has been remedied.
Three practical points follow from the wording of section 10:
- Cover can resume. Under section 10(4), the insurer remains liable for losses before the breach, and for losses occurring after the breach has been remedied where it can be remedied.
- What counts as remedied. In most cases, a breach is remedied when the insured ceases to be in breach, for example by repairing a broken lock or switching a lapsed alarm back on. Where a warranty required something to be done by a set time and that deadline was missed, section 10(5) treats the breach as remedied if the risk later becomes essentially the same as originally contemplated.
- Exceptions. The suspension does not apply if the warranty stops being applicable because of a change of circumstances, if compliance becomes unlawful, or if the insurer waives the breach.
The Explanatory Notes add that the Act does not change the definition of a warranty. Whether a security term in a policy is a warranty at all is a question of policy wording and general law.
Terms that are irrelevant to the loss
Section 11 is the provision most relevant to household security conditions. It applies to a term, express or implied, other than one defining the risk as a whole, where compliance would tend to reduce the risk of loss of a particular kind, loss at a particular location or loss at a particular time. If the term has not been complied with and a loss occurs, the insurer may not rely on the non-compliance to exclude, limit or discharge its liability if the insured shows that the non-compliance could not have increased the risk of the loss that actually occurred, in the circumstances in which it occurred.
The Explanatory Notes give a household example: where a property has been damaged by flooding, an insured is expected to be able to show that failing to use the required type of window lock could not have increased the risk of that loss, so the insurer should pay the flood claim. The notes also say a direct causal link between the breach and the loss is not required; the test is whether the non-compliance could have increased the risk of the loss that actually happened, not whether it caused the loss.
Where section 11 does not help
Section 11 works only where the security term is not irrelevant to the loss. If a policy requires window locks and a burglar enters through an unlocked window, a householder would have difficulty showing that the missing lock could not have increased the risk of that burglary. The Act protects against unrelated refusals; it does not remove genuinely relevant conditions. The Explanatory Notes also say section 11 covers more than warranties and can catch conditions precedent and exclusion clauses, provided they relate to a particular type of loss or a particular place or time. Terms defining the risk as a whole fall outside it; the notes give a requirement that a property is not used commercially as an example.
Sections 10 and 11 can apply together
Section 11(4) says section 11 may apply in addition to section 10. The Explanatory Notes explain this arises only where the term is a warranty, because section 10 applies only to warranties. A householder who breached a warranty could therefore face suspension of cover under section 10 while still arguing under section 11 that the breach was irrelevant to the loss suffered.
Why consumers cannot be contracted out of these rules
Section 15 provides that a term of a consumer insurance contract, or of any other contract, that would put the consumer in a worse position on matters covered by Parts 3 or 4 of the Act than the Act itself provides is to that extent of no effect. In practical terms, wording in a home policy that promises to void cover for any security lapse, regardless of relevance, cannot override sections 10 and 11 for a consumer. Section 15 does not apply to a contract settling a claim.
What householders can do
- Read the policy schedule and wording for terms headed conditions, warranties or security requirements, and note what they require.
- Keep records showing compliance, such as lock certificates or alarm servicing invoices. Background on lock standards is in the guide to BS3621 and insurer-approved locks.
- Fix or report any lapse quickly, since section 10 treats a remedied breach as restoring cover for later losses.
- Tell the insurer about material security changes when asked; the separate disclosure rules are covered in Telling Your Insurer About Locks, Alarms and Past Burglaries.
The bottom line
The Insurance Act 2015 turns security conditions from an all-or-nothing trap into a narrower rule. Breaching a warranty suspends cover until it is fixed, terms unrelated to the loss cannot be relied on, and consumer policies cannot contract out of either protection. None of this replaces compliance: a security term that is relevant to the loss can still defeat a claim.
Sources
- legislation.gov.uk, “Insurance Act 2015, section 10: Breach of warranty”
- legislation.gov.uk, “Insurance Act 2015, section 11: Terms not relevant to the actual loss”
- legislation.gov.uk, “Insurance Act 2015, section 15: Contracting out: consumer insurance contracts”
- legislation.gov.uk, “Insurance Act 2015, Explanatory Notes: Part 3, Warranties and other terms”