What Happens If Information on a Life Insurance Application Is Inaccurate?

What Happens If Information on a Life Insurance Application Is Inaccurate?

When you apply for life insurance, the insurer relies on the answers you provide to decide whether it can offer cover and what the premium should be.

That makes accuracy important. But an incorrect answer does not automatically mean your life insurance is cancelled or that a future claim will be refused. The outcome depends on what was wrong, why it was wrong, whether the information mattered to the insurer and what the insurer would have done if it had received the correct information at the start.

There is an important difference between making an innocent mistake and deliberately giving false information to obtain cover.

What are you required to do when applying?

For UK consumer insurance, the legal duty is to take reasonable care not to make a misrepresentation to the insurer. That means answering the insurer's questions carefully and accurately based on what you know.

The clarity of the insurer's questions can also matter when deciding whether reasonable care was taken. You are not expected to be a doctor or an insurance underwriter. Your job is to answer the questions you are actually asked rather than deciding for yourself which information the insurer would or would not consider important.

If you have a more complicated medical history, our life insurance with pre-existing conditions section explains why the detail surrounding a condition can matter.

Does every mistake create a problem?

No.

For an insurer to have a remedy for a misrepresentation under the Consumer Insurance (Disclosure and Representations) Act 2012, the insurer must show that the incorrect information mattered to its decision.

In broad terms, it must show that with the correct information it would either not have entered into the insurance contract at all or would have done so on different terms. That is important because not every typing error or forgotten detail automatically changes the policy. A mistake about something that would have made no difference to the insurer's underwriting may have a very different consequence from inaccurate information about a significant medical condition.

What information commonly matters on a life insurance application?

Life insurance applications can ask about areas such as your health, medical history, medication, smoking or nicotine use, alcohol consumption, occupation, hobbies and other factors relevant to underwriting. The insurer may also ask whether you are awaiting medical investigations or treatment. Those answers help determine the risk the insurer is being asked to cover.

If you want to understand how those factors are assessed, our guide to [how insurers assess risk for life insurance](/article/how-insurers-assess-risk-for-life-insurance) explains the underwriting process in more detail.

What if you accidentally forget a medical condition?

An accidental omission does not automatically mean the insurer will refuse every future claim. The insurer would first need to consider what happened and whether the missing information amounted to a qualifying misrepresentation.

It would then consider what it would have done if you had supplied the correct information when the policy was arranged. For example, imagine somebody forgets to disclose a medical condition because they genuinely believed it fell outside the period covered by the question. That situation is different from somebody knowingly answering “no” to a clear question despite knowing that the correct answer is “yes”.

The circumstances matter.

What is a careless misrepresentation?

The legislation distinguishes between careless misrepresentations and those that are deliberate or reckless. A careless misrepresentation is broadly one that is not deliberate or reckless but where the consumer did not take the reasonable care required.

What happens next depends on what the insurer would have done with the correct information. That means there is no single automatic penalty for every careless mistake.

What if the insurer would still have offered cover?

Suppose the information was inaccurate, but the insurer would still have provided life insurance. It then asks what terms it would have offered.

If the policy would have been issued on different non-premium terms, the insurer may be able to treat the contract as though those terms had applied from the start. If the insurer would still have provided the same cover but charged a higher premium, the legislation allows a claim to be reduced proportionately to reflect the premium that should have been paid.

So an inaccurate answer does not necessarily turn a valid policy into no policy at all.

What if the insurer would never have offered cover?

The consequences can be more serious if the insurer can show that, with the correct information, it would not have entered into the contract on any terms. For a careless qualifying misrepresentation, the insurer may be able to avoid the contract and refuse the claim, although the premiums paid must generally be returned. 

That is why significant medical or lifestyle information should not be guessed at or deliberately left out.

What if the inaccurate information was deliberate?

The position is more serious where a qualifying misrepresentation was deliberate or reckless. Broadly, that can include situations where somebody knows an answer is untrue or misleading, or does not care whether it is true, and knows or does not care that the information is relevant to the insurer.

Where that happens, the insurer may be entitled to avoid the policy and refuse claims. It may also be entitled to retain premiums unless doing so would be unfair in the circumstances.

That is very different from making an honest error.

What does “deliberate or reckless” actually mean?

It does not simply mean that an answer turned out to be wrong. The insurer has to distinguish a deliberate or reckless qualifying misrepresentation from a careless one.

Under the legislation, it is for the insurer to establish that a qualifying misrepresentation was deliberate or reckless.  For example, deliberately hiding a diagnosed medical condition after being asked a clear and specific question is very different from incorrectly remembering the date of an appointment.

Context matters.

What if you simply did not know?

You can generally only answer questions using the information reasonably available to you. If you had no diagnosis and genuinely did not know you had a medical condition when you applied, that is different from knowing about the condition and choosing not to disclose it.

However, the insurer may ask about more than confirmed diagnoses. It might ask whether you are experiencing symptoms, awaiting investigations, waiting for test results or receiving treatment. If the question covers those circumstances, you should answer accordingly even if no formal diagnosis has yet been made.

What if the insurer's question was unclear?

The wording of the insurer's question can matter. The Consumer Insurance (Disclosure and Representations) Act specifically says that whether the insurer asked clear and specific questions can be relevant when deciding whether the consumer took reasonable care. 

That is another reason the issue is more complicated than saying, “Any wrong answer means the policy is invalid.” If you are unsure what a question means, asking the insurer or intermediary for clarification before submitting the application is sensible.

What about getting a date slightly wrong?

Not every inaccurate date is necessarily significant. Suppose you say that an appointment happened in March when it actually happened in February.

Whether that matters will depend on the circumstances. If the difference would have had no effect on the insurer's decision, it is very different from incorrectly stating that significant medical treatment happened ten years ago when it actually happened six months ago.

The importance of an error depends on its effect on underwriting.

What if you forget medication?

Medication can be relevant because it may help the insurer understand an underlying medical condition. If an application specifically asks what medication you take, answer as accurately as possible.

Where you cannot remember the exact name or dose, checking your prescription or medical information before completing the application may be better than guessing. An insurer is generally interested in obtaining an accurate picture of the risk rather than trying to catch applicants out over minor details.

What about smoking or vaping?

Smoking and nicotine use can have a significant effect on life insurance pricing. That means an incorrect smoker declaration can be particularly relevant. Insurers define smoker status according to their own application questions, and the questions can cover cigarettes, cigars, vaping or other nicotine products.

If you have recently stopped using nicotine, do not assume that automatically makes you a non-smoker for insurance purposes.

Answer the insurer's question according to the definition it gives you.

Can an insurer check your answers when a claim is made?

Yes, an insurer may review information when assessing a claim. That does not mean every claim involves searching for a reason not to pay. The insurer needs to establish that the claim falls within the policy and may need to confirm information relevant to the original underwriting.

If information emerges that differs from the application, the insurer can consider whether there was a qualifying misrepresentation and what difference the correct information would have made. That is why accurate disclosure at the beginning is important.

Does the incorrect information have to cause the death?

The legal question is not necessarily as simple as asking whether the inaccurate answer directly caused the eventual claim.

The statutory test focuses on whether the insurer would have entered into the contract, or would have entered into it only on different terms, if it had received the correct information.  So it is unwise to assume that information can safely be omitted because you believe it has nothing to do with the cause of death.

Answer what the insurer asks and allow the insurer to decide what is relevant to its underwriting.

What should you do if you realise you made a mistake?

If you discover that something on your application was wrong, contacting the insurer or intermediary is generally better than knowingly allowing the incorrect information to remain uncorrected. Explain what the error was and provide the accurate information. The insurer can then tell you whether it affects the policy.

Depending on the circumstances, it may make no material difference, require an adjustment or need further underwriting. Trying to correct an honest mistake is very different from waiting until a claim occurs and hoping the discrepancy is never noticed.

What if your health changes after the policy starts?

This is different from information being inaccurate when you applied. With ordinary life insurance, you do not normally reapply every time your health changes after the policy has begun. The key issue is whether the information supplied when the contract was entered into or varied was accurate according to the questions asked at that time.

If you are considering changing or increasing your policy later, however, the insurer may ask new health questions as part of that application.

Can an insurer cancel a life insurance policy because of a careless mistake?

The rules surrounding an existing life policy are more nuanced than simply allowing an insurer to cancel whenever a mistake is discovered. The legislation sets out remedies based on what the insurer would have done had the correct information been supplied, and it contains specific protection around terminating contracts that are wholly or mainly life insurance. 

The practical outcome therefore depends on the individual circumstances rather than an automatic cancellation rule.

Can a claim be reduced instead of refused?

Yes, in some circumstances. If the misrepresentation was careless and the insurer would have provided the cover but charged a higher premium, the legislation provides for a proportionate reduction in the claim.

In simple terms, the insurer can compare the premium actually paid with the premium that should have been charged and reduce the claim accordingly.

That is one reason it is inaccurate to say that every incorrect answer automatically results in a rejected claim.

Why accurate disclosure protects you as well as the insurer

Accurate disclosure is not merely about helping the insurer price risk. It also gives you greater confidence that the policy you are paying for has been underwritten using the correct information. The objective of life insurance is to leave dependable protection for the people who rely on you. A slightly cheaper premium obtained by concealing important information is of little value if that creates uncertainty when your family eventually needs to claim.

What if you are worried that your medical history will make cover expensive?

Do not respond by leaving information out. A better approach is to understand how different insurers may assess the circumstances. Insurers do not all have identical underwriting appetites. One may charge more for a particular medical history while another may assess it differently. Our life insurance with pre-existing conditions section explains why comparing underwriting approaches can matter when your medical history is less straightforward.

You can also read our guide to how insurers assess risk for life insurance for a broader explanation of what goes into an underwriting decision.

What if you have already had an application declined?

A previous refusal does not mean you should hide it from another insurer if you are asked about previous applications.

Answer the question accurately. There may be several reasons an insurer declined the original application, and another provider may assess the circumstances differently.

Our guide to common reasons life insurance can be refused explains the possible outcomes and why one insurer's decision does not automatically represent the whole market.

A simple example

Imagine two people both fail to mention high blood pressure on a life insurance application.

The first genuinely forgot about a single borderline reading from several years ago and reasonably misunderstood a question about recent treatment. The second is currently taking medication for diagnosed hypertension but deliberately answers “no” when asked whether they have ever received treatment for high blood pressure.

The missing information may look similar when written down, but the circumstances are not. The insurer would need to consider the question that was asked, what each applicant knew, whether reasonable care was taken and what the correct information would have changed about the underwriting.

That is why inaccurate information cannot sensibly be treated as one single category.

The bottom line

Incorrect information on a life insurance application can matter, but it does not automatically mean the policy is worthless.

The consequences depend on what was inaccurate, whether the applicant took reasonable care, whether the mistake was careless or deliberate, and what the insurer would have done if it had received the correct information. A careless mistake may result in different policy terms, a proportionately reduced claim or, where the insurer would never have offered cover, the policy being avoided and the claim refused.

Deliberate or reckless misrepresentation can have much more serious consequences.

The safest approach is simple: read the questions carefully, check anything you are unsure about and answer accurately.

If you realise later that you made a genuine mistake, raise it rather than ignoring it.

And if a medical history makes you worried about obtaining cover, do not hide it. Find out how insurers are prepared to assess it.

Compare life insurance options with a pre-existing condition