Legal Entity Names – The single MOST important part of an insurance policy

The first and single most important part of an insurance policy is to ensure the Insured name is correct. And that Insured name MUST be a full legal entity. If you don’t get the Insured name correct or the name you enter as the Insured is not a legal entity then the insurance contract is not valid and may not respond to claims.

Brokers input the insured name into online portals or complete the Insured name in a quotation slip therefore it’s up to the broker to ensure the name they enter as the insured name is a legal entity name. If a client completed a proposal form with a name that is not a legal entity then the broker must go back to the client and obtain their legal entity name. Near enough is not good enough. A claim or writ will only ever be served against the legal entity so for the insurance policy to respond the policy must be in the legal entity name.

A legal entity name is the name of the entity that appears on all official documents or legal papers. It can be different to a business name. If it’s a company, it will be the full company name including proprietary limited (Pty Ltd or any variation).

Only the names highlighted in Bold are legal entities!

1. Brian Johnson Trading as Johnson’s Accountants
2. Johnson’s Accountants
3. Johnson’s Family Trust t/as Johnson’s Accountants
4. Johnson and Partners Accountants Pty Ltd
5. Johnson and Partners Trading Trust
6. Brian Johnson & Fred Smith T/as Johnson & Smith Accountants

Trusts & Trading names are NOT legal entities in their own right. A trust must have a company or a person as the trustee. ABN Lookup is not a reliable reference policy as it lists Business or Trading names which can be different to the legal entity name.

The Insured name is more important than any other part of the insurance policy because if you don’t get the Insured legal entity name correct then the policy may not respond to a claim.

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ASIC – The difference between a trading name, business name and company name