AustraliaI signed an insurance policy but wasn't told about a key exclusion. Can the insurer rely on it?
No — under Australian law, insurers must take reasonable steps to draw key exclusions to your attention when you sign the policy; if they don’t, the exclusion may not be enforceable.
What the Law Says
The Insurance Contracts Act 1984 (Cth) sets strict rules about how insurers must communicate important terms — especially exclusions — before a contract is formed.
Under section 21(1)(a) of the Insurance Contracts Act 1984 (Cth), an insurer must take 'reasonable steps' to draw your attention to any exclusion clause before the insurance contract is entered into.
This means simply including an exclusion in the fine print of a long document is usually not enough. The insurer must actively highlight it — for example, by using bold text, separate headings, or oral explanation — so that a reasonable person would notice and understand its significance.
The law treats exclusions as particularly important because they limit your rights under the policy. If the insurer fails to meet the 'reasonable steps' requirement, the exclusion is not binding on you — even if you signed the policy.
Statutory TextThe insurer must take such steps as are reasonable in the circumstances to draw the insured's attention to the provision before the contract is entered into.
— Insurance Contracts Act 1984 (Cth), s. 21(1)(a) — Duty to draw attention to exclusions
What to Do
Check your policy documents: Look for how — and where — the exclusion is presented (e.g., font size, placement, headings).
Gather evidence: Save emails, call recordings, or notes from conversations with the insurer or broker about what was explained.
Contact the insurer in writing: Ask them to confirm what steps they took to draw the exclusion to your attention before you signed.
Lodge a complaint with the Australian Financial Complaints Authority (AFCA) if the insurer refuses to waive or apply the exclusion fairly.
Seek legal advice promptly — time limits may apply to challenge the exclusion’s enforceability.
Sources
Not legal advice. This article is general information based on publicly available sources, written for educational purposes. Laws change and individual situations vary. Consult a licensed attorney in your jurisdiction before acting on anything you read here. Last reviewed: 2026-06-08.