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If your insurance claim has been denied, or you’re worried about protecting your home or business, you may be wondering whether failing to follow a condition in your policy can affect your coverage. The answer is often yes.
Many people don’t realize that insurance policies frequently contain policy warranties—specific promises that the policyholder agrees to follow throughout the life of the policy. Whether you have commercial insurance, property insurance, home insurance, or another type of coverage, failing to comply with these warranties could result in a denied claim or even the cancellation of your policy.
What Is a Policy Warranty?
A policy warranty are certain conditions set by the insurance company for the insured to abide by and if certain conditions are not met your claim will be denied. These warranties help insurers assess and manage risk while encouraging policyholders to take reasonable steps to protect their property or business.
There are two main types of warranties:
| Express Warranty | Implied Warranty |
|---|---|
| Specifically written in the insurance policy | Arises from the nature of the insurance contract or an express warranty |
| Example: Completing monthly fire safety inspections | Example: Properly maintaining equipment connected to the fire safety system |
Both types of warranties can affect your insurance coverage.
Why Are Policy Warranties Important?
Policy warranties are more than administrative requirements; they are often fundamental terms of your insurance contract.
For example, your policy may require you to:
- Maintain fire protection or sprinkler systems.
- Perform regular inspections or equipment maintenance.
- Keep security systems operational.
- Remove known hazards from your property.
- Train employees on required safety procedures.
These requirements reduce risk for both the insurer and the policyholder. In many cases, complying with them can also help keep insurance premiums lower.
What Happens If You Don’t Follow a Policy Warranty?
Failure to comply with a policy warranty can have serious consequences.
Depending on the wording of the policy and the circumstances, an insurer may:
- Deny all or part of your insurance claim.
- Void coverage for a particular loss.
- Cancel or refuse to renew your policy.
Importantly, an insurer may rely on a breached warranty even if the warranty itself did not directly cause the loss. This is why it is essential to understand your policy before an incident occurs.
Why Legal Advice Can Make a Difference
Insurance policies are legal contracts, and disputes often arise over how policy wording should be interpreted. Determining whether a warranty has been breached—and whether an insurer is entitled to deny coverage—can involve complex legal analysis.
Frequently Asked Questions
Can my insurance company deny my claim because I didn’t follow my policy?
Yes. If you fail to comply with an important policy warranty or condition, your insurer may deny your claim or argue that coverage is unavailable.
What is the difference between an express and an implied warranty?
An express warranty is written directly into the policy. An implied warranty is not specifically stated but may arise from the nature of the contract or from an express obligation.
What should I do if my insurance claim is denied?
Ask your insurer to explain the reason for the denial in writing and seek legal advice before accepting the decision. An experienced insurance lawyer can review your policy and assess whether the denial is legally justified.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
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