CKA RISK SOLUTIONS PTY LTD > IMPORTANT NOTICES > 26/06/2014 (V1) PAGE 1 OF 5 Disclaimer
The information provided in your invoice & schedule is a summary only (errors and omissions excepted) and does not purport to be a copy of the insurance underwriters’ policy or other documents. In case of any discrepancy, the underwriters’ documents will prevail.
A full copy of your policy wording will be passed on to you as soon as it is received from your insurer. It is absolutely essential that you read this document without delay and advise CKA in writing of any aspects which are not clear, incorrect or where the cover does not meet with your requirements.
Your Duty of Disclosure
Before you enter into a contract of general insurance with an insurer, you have a duty, under the Insurance Contracts Act 1984, to disclose to the insurer every matter that you know, or could reasonably be expected to know, is relevant to the insurer’s decision whether to accept the risk of the insurance and, if so, on what terms.
You have the same duty to disclose those matters to the insurer before you renew, extend, vary or reinstate a contract of general insurance.
Your duty, however, does not require disclosure of any matter:
That diminishes the risk to be undertaken by the insurer.
That is of common knowledge or public knowledge.
That your insurer knows or, in the ordinary course of his business, ought to know.
As to which compliance with your duty is waived by the insurer.
If you fail to comply with your duty of disclosure, the insurer may be entitled to reduce its liability under the contract in respect of a claim or may cancel the contract. If your non-disclosure was fraudulent, the insurer may also have the option of voiding the contract from the beginning.
Detailed below are some examples of information that should be disclosed to the insurers: Personal Information
Prior criminal convictions.
Bankruptcy or any default.
Past driving history (eg. dangerous driving or driving under the influence).
Prior refusal by insurers to insure you or where they have imposed increased loadings or deductibles. Other Business Information
Acquisition of new companies, operations either in Australia or overseas.
The purchase, leasing or change in tenancy of any new or existing premises.
The purchase, loan, or lease of any items of plant, machinery, equipment or contents.
The temporary hire of any items of plant (eg. gen sets, motor vehicles or mobile plant).
The entering into or any agreement whereby you forego your rights to indemnity from another party, eg. lease agreements, fire & security monitoring agreements.
Changes to your normal processes or business operations.
Introduction of new or modified products.
The disconnection or the rendering of any fire or security system in-operative.
The chartering of any aircraft or water craft.
Any capital raising or the listing on any foreign Stock Exchange.
Any alterations, extensions or modifications to your office, premises or factory.
If you are in any doubt whatsoever regarding your disclosure obligations, please discuss this issue with CKA.
Utmost Good Faith
Every insurance contract is subject to the doctrine of utmost good faith, which requires that the parties to the contract should act toward each other with the utmost good faith. Failure to do so on your part may prejudice any claim or the continuation of cover provided by your insurer.
Change of Risk or Circumstances
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In order to ensure proper protection, please consult us if you are in any doubt as to whether an insurer should or should not be told of certain changes. We would rather address these queries now rather than take the risk of you not having protection under your policies.
No alteration to the risk will take effect until acceptance is confirmed by the insurer.
Subrogation and/or Waiver of Rights
Some policies contain provisions that either exclude the insurer from liability or reduce their liability, if you have entered into any agreements that exclude or limit your rights to recover damages from another party in relation to any loss, damage or destruction which would allow you to sustain a claim under an insurance policy.
You may prejudice your rights to a claim if, without prior agreement of your insurer, you make any agreement with a third party that will prevent the insurer from recovering the loss from that or any another party. Examples of such agreements are the “hold harmless” clauses, which are often found in tenancy leases, maintenance or supply contracts from burglar alarm or fire protection installers and in repair contracts.
Some policies, such as Industrial Special Risks, General Property, Fire and Perils, Business Interruption, House & Contents contain an “average” or “under-insurance” or “co-insurance” clause. This clause requires you to bear a proportion of any loss in the event your sum insured is not adequate to cover the full amount of the loss. For example, if the replacement cost of your house is $400,000 and you have only insured the building for $300,000, then effectively, your insurer is insuring 75% of the house and you are insuring the remaining 25%. In the event of a fire causing $200,000 damage, your insurer would only be obliged to pay $150,000 (ie $200,000 x 75%) and you would be liable for the balance.
It is particularly important to ensure that the sums insured are adequate and declared in accordance with the policy requirements to avoid the application of any under-insurance provisions. If in any doubt, please contact our office.
Most policies will exclude indemnity to other parties unless their interest is properly declared and noted on the policy. If you require the interest of any party other than the named insured to be covered, you must specifically request this and detail the nature of the relationship between you and the other party e.g. mortgage with a bank, lease agreement on your motor vehicle.
Claims Made Policies
Some policies, such as Professional Indemnity, Directors & Officers Liability and Crime provide cover on a “claims made” basis which means that claims first advised to you (or made against you) and reported to the insurer during the period of insurance are covered irrespective of when the incident causing the claim occurred, subject to the provisions of any clause relating to “Retrospective Cover” (see the following heading titled “Retrospective Cover”).
In order to ensure that your entitlement to indemnity under this policy is protected, you must report all incidents that may give rise to a claim against you to the insurer without delay after such incidents come to your attention and prior to expiration of the policy period.
Not a Renewable Contract
Cover on certain policies, such as Professional Indemnity, Directors & Officers and Crime, terminate on the date advised to you or as indicated on our debit notes/invoices. We emphasise that these policies are NOT renewable contracts. If you wish to effect similar insurance for any subsequent period, it will be necessary for you to complete a new proposal form well prior to the termination of the current policy so that terms on the new insurance can be obtained in time for your consideration.
Certain policies, such as Professional Indemnity, Directors & Officers and Crime, do not provide cover in respect of claims arising out of work performed or services rendered or events occurring prior to the date specified, known as the Retroactive Date. Usually, this cover can be obtained upon specific request and if available, an additional premium will usually apply. Please consult CKA if this cover is required or if you have any questions in this regard.
Mis-Statement of Premiums
CKA take all reasonable effort to ensure the premiums (including all statutory charges) quoted to you are correct. The statutory charges in particular, are subject to constant change and vary markedly on a “state by state” basis. Some charges, such as Fire Service Levy (in NSW and Victoria) are subject to retroactive adjustments 12 months in arrears.
In the event that the premium is incorrectly quoted by CKA or is subject to change (ie. NSW Fire Service Levy), CKA reserve the right to amend the premium to the correct amount for which you are liable to pay.
Cancellation Warning (retention of brokerage and fees)
CKA RISK SOLUTIONS PTY LTD > IMPORTANT NOTICES > 26/06/2014 (V1) PAGE 3 OF 5 Contact Agreement
To ensure that we provide you with appropriate products and services, you agree to us calling you at our discretion to discuss any new products and services. If you do not wish to receive such calls please advise us and we will place you on our Do Not Call Register.
Electronic Delivery of Disclosure Notices
Please note that where possible we prefer to provide all correspondence and disclosure notices (including Financial Services Guides and Product Disclosure Statements) to you electronically, via email or links to websites etc. If you have provided your email address to Us we will typically use that email address for all correspondence and disclosure notices. Should you not wish to be sent disclosure documents electronically please advise us accordingly and we will update our records accordingly.
Wholesale Broker Information
In some cases we use the services of a Wholesale Broker to access products that are not available to us directly from the underwriter. You can identify where we have used a Wholesale Broker as the Invoice will show that the policy is written via another Insurance Broker. This situation usually arises where the Wholesale Broker has developed a specialised product and competitive pricing for risks that are not commonly available from most insurers. This means we are not dealing with the end insurer directly but via the Wholesale Broker. All Wholesale Brokers are required to hold an Australian Financial Services Licence and to place all client funds received into a Trust Account and are required to meet the same high standards in the delivery of their services that apply to us. Importantly all claims will be the ultimate responsibility of and paid for by the end insurer.
Underwriting Agencies and Wholesale Broker Disclosure Documents
Should you wish to access the Financial Services Guide of an Underwriting Agency or Wholesale Broker please contact us and we will arrange to have a copy sent out to you.
Clients not satisfied with our services should contact our Complaints Officer. We are members of the Financial Ombudsman Service (FOS), a free consumer service. Further information is available from our office, or contact FOS directly on 1300 780 808 or visit www.fos.org.au. We also follow the Insurance Brokers Code of Practice.
Terms of Trade
Payment of this account constitutes your acknowledgement and acceptance of these conditions and authorises us to act as your insurance brokers for the risks outlined on the face hereof and no others unless specifically agreed by us in writing. Un-insured Risks
The following is a sample of some of the many classes of insurance that are available. Detailing these insurances does not imply that you have a specific need for the insurance or that it is readily available in the insurance market. Indeed, your insurance program may already encompass some of these classes of insurance.
Should you wish to discuss any aspect or require further information on any insurance detailed below, please contact CKA.
Advance Business Interruption
Cover for loss of anticipated income where completion of a construction project is delayed by insured damage during the construction period.
Airport Owners or Operators Liability
Your legal liability for third party injury or property damage arising out of the ownership or operation of an airport/airstrip.
Insurance bonds are available to accommodate a wide variety of situations (eg. performance guarantee) and may be a viable alternative to bank guarantees.
Loss or damage to contract works during construction, and/or while undergoing testing and commissioning.
CKA RISK SOLUTIONS PTY LTD > IMPORTANT NOTICES > 26/06/2014 (V1) PAGE 4 OF 5 Defamation (Libel and Slander)
Legal liability for injury to the reputation, goodwill, profession, trade, business or credit of third parties in consequence of defamation, libel and slander.
Cover against electronic breakdown or failure of computer and other electronic equipment.
A limited insurance market is available to cover costs incurred due to gradual accidental pollution.
Expatriate Health Insurance
Covers medical, hospital and other expenses for Expatriate employees living overseas and/or in Australia on a temporary basis.
Goods in Cold Storage
Loss or damage to goods in cold storage due to mechanical failure of the refrigeration equipment.
Key Man Insurance
Death and/or disability insurance for key executives or employees.
Legal expenses incurred as a result of contractual disputes, the use of motor vehicles and a variety of other circumstances.
Life and Benefits
Cover for Life, disability, trauma, income protection, superannuation and other employee benefits.
Livestock or Bloodstock
The insurance of animals against death by accident, sickness or disease.
Loss of Licence
Insures a person who is dependent upon a form of license in order to earn a livelihood eg. pilot. The insurance covers specified benefits in the event of accident or disability, which results in discontinuance of the license.
Marine Cargo Consequential Loss
Loss of income and/or business interruption following the loss or damage to the cargo whilst in transit.
Cover for loss or damage to commercial or private watercraft.
Insures expropriation, confiscation and nationalisation of property in foreign countries. Cover can also be extended to cover contract repudiation, license cancellation or currency inconvertibility.
Product Contamination / Tampering
Covers the recall and reimbursement costs as a result of accidental contamination and/or tampering.
Covers the legal obligation to replace or repair products, which fail to perform their intended function or financial loss, sustained by a customer or third party arising there from.
Covers the expenses incurred in recall of potentially faulty products.
Loss as a result of a breach of your professional duty by reason of any negligent act, error or omission.
Designed to protect the livelihood of an employee or self employed person as a result of an accident or prolonged illness.
Statutory Liability Insurance
Covers fines, penalties and costs resulting from an innocent breach of an Act.
Covers the legal liability arising from stevedoring activities at any port or airport.
CKA RISK SOLUTIONS PTY LTD > IMPORTANT NOTICES > 26/06/2014 (V1) PAGE 5 OF 5 Terrorism
A limited form of cover is available in addition to the Govt scheme.
Trustees Liability Insurance
Covers trustees, trust managers, sponsors of superannuation funds in respect of legal liability to compensate third parties (including legal costs incurred) arising out of the negligent administration of the trust or fund.
Insurance Terms Glossary
Some commonly used terms are peculiar to the insurance market and as such, we have detailed explanations to some of these terms below as a quick guide for you.
The principal of indemnity is to place you in the same financial position after a loss as that which you occupied immediately before the loss. You do not receive "new for old".
Reinstatement And Replacement
The basis of settlement for property insured under these conditions would be the cost of replacement or restoration with new materials to a condition substantially the same as, but not better or more extensive than its condition when new.
Extra Cost of Reinstatement
Provides protection for additional costs to comply with Government Regulations following the loss, provided you had not been advised of such requirements prior to the loss.
If the actual value of the property exceeds the amount stated in your declaration, you may be expected to bear a proportionate part of a loss.
Also called “excess”, is the amount the insured is required by the policy to contribute towards a loss.
Is the amount, which the total of the turnover and closing stock exceeds the total of the opening stock and the uninsured working expenses as specified in the policy.
Dual Basis Payroll
Salaries and wages are insured under a flexible method whereby you can decide the manner in which a claim may be lodged subject to certain limitations stated in the policy.
Is the period from the date of the damage and ending not later than the period specified thereafter during which the business is affected by the damage.
Your Insurer may wish to recover from a third party responsible for damage to your property. Consequently, the Insurer requires that you subrogate (or substitute) your rights to sue in favour of your Insurer who has reimbursed you for the cost of the damage. Your insurance policy may be conditional that you do not “waive your rights or hold harmless” other parties such as workmen who come onto your property.
This term refers to a quality inherent in property, which produces damage to the property without the assistance of an outside agency and by its own action eg. spontaneous combustion of copper concentrate.
Free on Board
Relates to the cost and charges from the supplier's works, including the cost of the goods, cases, packing, rail, delivery charges, dock charges, insurance, customs and agents charges at the port of shipment. In other words the total cost of the goods to be delivered onto the vessel.
Cost, Insurance & Freight (CIF)
The FOB cost plus freight, insurance and all other charges for delivery to the declared port or final destination.