Insurance over the phone - what constitutes the contract

TELLIT01

If you receive new policy documents, they will completely replace any terms, conditions or restrictions in previous years.

Old_Lifer

All that seems to have happened here  is that the Insurer  has revised a policy condition  and the change does,  as   rs65   says, appear to  have gone in your favour.    The change would have  applied to all policyholders  with the same type of policy.

If the conversation with the agent  (or call centre)  was as long as your original post,  is it possible that a misunderstanding may  perhaps have arisen?

j_e_e

TELLIT01 said:

If you receive new policy documents, they will completely replace any terms, conditions or restrictions in previous years.

That was precisely what I was hoping to get, a succinct answer. 

j_e_e

Old_Lifer said:

All that seems to have happened here  is that the Insurer  has revised a policy condition  and the change does,  as   rs65   says, appear to  have gone in your favour.    The change would have  applied to all policyholders  with the same type of policy.

If the conversation with the agent  (or call centre)  was as long as your original post,  is it possible that a misunderstanding may  perhaps have arisen?

Gee, thanks, I think. Maybe if you'd pondered my post for a while longer you would have understood that this was, as confirmed by the agent, an actual real-life error by the insurer and not an intended change in terms. That was kind of the heart of the question, meaning what happens in that case when the validity of a claim hinges on the lost clause. But thanks for getting involved.

Ditzy_Mitzy

j_e_e said:

Old_Lifer said:

All that seems to have happened here  is that the Insurer  has revised a policy condition  and the change does,  as   rs65   says, appear to  have gone in your favour.    The change would have  applied to all policyholders  with the same type of policy.

If the conversation with the agent  (or call centre)  was as long as your original post,  is it possible that a misunderstanding may  perhaps have arisen?

Gee, thanks, I think. Maybe if you'd pondered my post for a while longer you would have understood that this was, as confirmed by the agent, an actual real-life error by the insurer and not an intended change in terms. That was kind of the heart of the question, meaning what happens in that case when the validity of a claim hinges on the lost clause. But thanks for getting involved.

The simple answer to this is 'I don't know', and I can't think it would have been possible to answer the question without the matter being tested in court.  As it's now, in essence, been rectified then it's highly unlikely to be tested in such a manner.  Everything else would seem like conjecture at this stage.
The contract terms, or the terms of the insurance policy anyway, were agreed in the initial sales call.  At that point, two years ago, a limited mileage insurance policy was purchased.  In the second year the same policy was renewed on the same terms, we know the terms were the same because the insurer has confirmed it, meaning that it has a mileage limit.  A renewal pack was issued, however this stated there was no mileage limit.  Therefore an unlimited mileage insurance policy existed on paper but not in fact. 
The policyholder reported the discrepancy to the insurer, an agent of which confirmed that the policy does indeed have a mileage limit.  That's the end of the matter, really, although for the sake of tidiness the insurer ought to issue replacement documents.  There's now evidence that the policyholder is aware of the mileage limit and knows he must not exceed it, for fear of being subject to whatever penalty the insurer applies.  The agent has not made a mistake, I'm not sure why he is deemed to have done so. 
Where it gets more complicated, possibly, is with the hypothetical instance of the policyholder assuming, on receipt of the erroneous document, that there isn't a mileage limit and choosing, on such an assumption, to exceed the allotted number of miles and then, having gone over the limit, making a claim.  I'd imagine that, if this happened, the insurer would take a 'commercial view' on matters and honour the claim - especially if it was of low value.  It would probably be the cheapest way out for the insurer.  Otherwise it could refuse the claim, on the basis that the policy was invalidated at the point of going over the allowed mileage. 
Then, if it went to court, the judge would need to weigh up whether it was reasonable for the policyholder to assume that the policy terms had changed on the basis of the error in the paperwork.  
That's the bit I don't know - I've had a look on the internet and wasn't able to find a relevant test case based on what's available publicly. 
Now for another question - are you really asking whether the insurance company should now provide an unlimited mileage policy, post the error in the paperwork being highlighted?  No, in my opinion.  

Old_Lifer

An error in insurance documentation is rare.    When  it does occur and  it is pointed-out to the insurer,  revised documentation is usually sent out quickly,  normally within a few days.

If no revised documentation has been issued,    it would  suggest that  there was no error   and the insurer has simply offered new terms at renewal.      In these circumstances,  when  j-e-e 's    says  he/she  thinks the agent  is wrong.  j-e-e  would be correct.

Ditzy_Mitzy

Old_Lifer said:

An error in insurance documentation is rare.    When  it does occur and  it is pointed-out to the insurer,  revised documentation is usually sent out quickly,  normally within a few days.

If no revised documentation has been issued,    it would  suggest that  there was no error   and the insurer has simply offered new terms at renewal.      In these circumstances,  when  j-e-e 's    says  he/she  thinks the agent  is wrong.  j-e-e  would be correct.

There is also, without wishing to cast aspersions, the possibility that no error occurred anywhere and j-e-e simply misread the renewal letter.  I suspect we'll never find out....