Q. I discovered on social media that my client is the new owner of a breed of dog that the insurer deems to be dangerous. Must I inform the insurer even though the client has not informed me?

R. Yes. It is not up to the agent or broker to choose which information he should give the insurer. You must always “give insurers the information that it is common practice […] to provide »^[1]. The insurer must therefore have all the information it requires to assess the risk properly.

Explanation

If you accidentally discover information that your client has failed to disclose, contact the client to confirm the details of the situation and tell him that you must notify the insurer.

Explain to your client that this may affect the cost of available coverage, the cost of the premium, or even the insurer’s decision to accept or refuse the risk. 

Furthermore, serious consequences may arise from not disclosing information: if the insurer discovers the false statement, it could ultimately decide to cancel the contract and refuse to compensate your client, or—under the best of circumstances—proportionally adjust the client’s compensation for any loss. 

If your client asks you to conceal this information or deliberately decides to not disclose a loss or a specific piece of information, inform him that disclosure is an obligation under your code of ethics.   

Lastly, do not forget to note in the client’s file everything you discussed with him including, in particular, the advice and explanations you provided, any decisions made and instructions the insured received ^[2].

^{[1] Section 29 of the Code of ethics of damage insurance representatives.}

^{[2] Sections 85 to 88 of the Act respecting the distribution of financial products and services, section 9 and 37(1) of the Code of ethics of damage insurance representatives and sections 12 and 21 of the Regulation respecting firms, independent representatives and independent partnerships.}