If you buy a protection or insurance product such as life insurance, critical illness or payment protection insurance alongside your mortgage, the person selling it to you will ask a number of questions about your health and lifestyle.

‘Non-disclosure’ occurs where an applicant does not tell an insurer a fact, which would have led to a different underwriting outcome – typically an increased premium, exclusion or refusal to insure.

Forgetting to mention a minor health issue such as headaches, a smoking habit or occasional pins and needles, could mean that your policy won’t pay out due to non-disclosure – even if your illness or condition is unrelated.

Non-disclosure is one of the most common reasons for a policy not paying out so it is best to always be honest when asked questions by a mortgage or insurance sales adviser.

Non-disclosure can be a controversial area as insurers, who can reject claims where information material to their assessment of taking on a proposal has been left out, make fine judgments as to whether an omission was innocent, reckless or outright deliberate.

About one in ten claims are rejected for non-disclosure.

In practice, insurers generally pay out on claims where the policyholder has innocently or inadvertently left out information but they come down heavier on customers who they feel deliberately omitted important information.