Insurance Disclosure

Pennine_Lady

Hi,

I'm writing on behalf of a friend (no internet).

This is just a quick question... He owns a Phone & Gadget repair shop and has a part time employee.

Over the last few weeks a few various small items have gone missing and he suspects (no evidence) that's it's the employee who's taking them.

The items, at the moment, are of little value and he doesn't want to report it to the police as the employee is the son of a friend and he doesn't want to accuse without any evidence.

The question is, even though it's only a suspicion does he have to tell his insurance company as a material fact? He's just a bit worried that if something more substantial got stolen he wouldn't be able to claim as he had his suspicions about this person.

I'm no expert but I've guessed the answer is no.

I said for example, if he had an employee who he suspected was speeding everywhere in the company vehicle he would not report it to the insurance company. If he did, the insurance company would probably ignore the heads up and couldn't put any terms/increase premium until such time we was actually convicted of speeding. However, I could be wrong!

dacouch

Most policies would not cover the theft by an employee as it tends to require a specific extra cover to be purchased which most people do not select as they're either confident in their staff or feel there's no risk so decide not to cover it or they find they cannot abide by the fairly stringent requirements to check staff out

Pennine_Lady

You're right dacouch.... but that's my friend's worry. The extra cover is there to buy and is available. But does he legally have to disclose his suspicion even though the employee is clean as a whistle and has done nothing wrong.