Proposal to encourage reinstatement of a lapsed insurance policy by accepting an overdue premium after the grace period. Usually such offers do not require submission of evidence of insurability or completion of a reinstatement application. Also called late-payment offer .
Insurance Encyclopedia
Latent Claims
Claims resulting from perils or causes which the insurer is unaware of at the time of writing a policy, and for which the potential for claims to be made many years later has not been appreciated. The first claims from these sources may often not be apparent until many years after the period of cover, e.g., asbestosis, pollution, industrial deafness etc.
Latent Damages Act 1986
Partly nullifies the House of Lords decision (Pirelli v. Oscar Faber & Partners (1983)) that when property damage occurs the limitation time runs from the time of damage. The Act adds a further three years’ limitation period from the date the damage was reasonably discoverable subject to a ‘long stop’ provision of 15 years from the act of negligence. The claimant’s knowledge of the damage or capability of reasonably discovering it, follows the knowledge’ requirements of the Limitation Act 1980.
Latent defect
A defect that does not present itself right away.
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A defect which is not immediately apparent.
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A hidden flaw that will, in time, cause property damage that is uninsurable. Such damage is uninsurable because the element of chance is no longer present. The property was flawed from the beginning, so the breakdown and damage was inevitable, and not accidental.
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UK: An existing defect that is not apparent or discoverable by reasonable care. For the purpose of decennial insurance, latent defects are ‘defects which have occurred at the time of construction but do not manifest themselves until some substantial time afterwards.
Latent defects insurance
See: Decennial Insurance.
Latent disease
Disease that may lie dormant or undiscovered for years before being diagnosed or discovered, e.g. asbestosis. See LONG-TAIL LIABILITY.
Launch insurance
Covers a spacecraft during the launch phase. The cover is material damage on an ‘all risks’ basis and includes the risk of malfunctioning. The policy runs from the initial ignition until the spacecraft reaches its correct and final orbit and its systems fully checked before it begins the commercial operations for which it was intended.
Launching State
A state from which a space object is launched into space, or one which performs or procures the launch.
Laundering of monetary instruments
To deposit into a general account illegally obtained funds (fraudulent claim payments) with legally obtained funds (legitimate claim payments). Also called money laundering .
Laundry list
List of past events (e.g. all house surveys by a particular person) that could lead to claims under a professional indemnity claims-made policy. By notifying the event in advance of any claim the insured seeks to have the event deemed as a’claim made during the policy period’ even though the policy, at time of claim, may have lapsed. The ‘laundry list’ may be a sufficient notification but insurers may contend that the list is too broad to protect the insured against any specific claims. Each case turns on its own facts (Hampton v. Field).