General Insurance Article - ABI guide to help insurers deal with criminal convictions

The Association of British Insurers (ABI) has issued updated guidance to help insurers treat people with criminal convictions fairly and in compliance with the law. The Guide sets out high-level standards of how insurers should treat people with convictions or related offences.

 The ABI Good Practice Guide: ’Insurers’ Approach to People with Convictions and Related Offences’ was first published in 2011 and updated in 2014 to reflect changes to the Rehabilitation of Offenders Act. While the Guide is voluntary, ABI members are encouraged to regularly review their products and processes to ensure that their approach is consistent with it, as well as in compliance with relevant legislation and regulatory requirements.

 The Guide has been updated to reflect changes to the law, regulatory requirements and insurer market practice, and to take account of the findings of research and recommendations made by Unlock, a charity that supports people with convictions.

 The Guide sets out that insurers should:

 Only ask about relevant unspent convictions (as opposed to spent convictions that do not have to be disclosed under The Rehabilitation of Offenders Act), using explicit, clear, and concise questions.

 Make clear to customers the consequences of any misrepresentation or non-disclosure of criminal convictions that they have been asked to disclose.

 Ensure all relevant staff are appropriately trained on applicable legislation and regulations and are able to respond to consumer enquiries.

 Mark Allen, Manager, Fraud and Financial Crime, ABI said: “The industry recognises that some of the 11 million people in the UK with a criminal record may face challenges when trying to buy insurance. Insurers want to be as financially inclusive as possible, and this Guide will further help them treat those with criminal convictions fairly, including asking clear and concise questions where any unspent convictions may be relevant.”

 Key elements of the Guide cover:

 The type of information on criminal convictions insurers may ask for during the application process. Insurers will only ever seek information relevant to the risk. They will ask explicit, clear and concise questions about unspent convictions, where appropriate providing explanatory contextual information to help the consumer respond. Spent convictions do not need to be disclosed, and insurers should not ask for information about them. If they are provided, then the insurer is legally required to ignore them. Unspent convictions are only one factor that that may affect the cost or availability of insurance. In practice, insurers take into account a range of factors (for example, for home insurance, these will include the size and construction of your home, the flood risk, the value of contents) not just, where relevant, any unspent convictions.

 How insurers can verify the relevant conviction history of a customer. An insurer wishing to verify the criminal conviction history of a customer may use the Disclosure and Barring Service, which provides wider access to criminal record information through its disclosure service for England and Wales. The Guide makes it clear that insurers should not require the customer to complete a subject access request to obtain information about unspent convictions for disclosure to the insurer.

 How insurers explain the consequences of non-disclosure of unspent convictions, and how they will ensure that customers are treated fairly if misrepresentation occurs. Insurers must make clear the consequences of not disclosing unspent criminal convictions when asked about them. Warnings should be prominent in the application process, with consumers required to explicitly confirm that they understand the consequences.

 Where a non-disclosure or misrepresentation occurs, such as the failure to disclose a relevant unspent conviction, insurers should ask the applicant why the information is incomplete or incorrect before making any final decision.

 How the industry can help ex-offenders experiencing challenges in obtaining insurance. Where an insurer is unable to provide full cover due to a customer’s criminal history, the insurer will provide information about alternative sources of help. This may include directing to organisations such as the charity Unlock, which supports people with convictions, or the British Insurance Brokers Association (BIBA) ‘Find a Broker’ helpline.

 Please read the full guide here.       

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