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📋 '''No-claim declaration''' is a formal statement made by a policyholder — or by the seller in an insurance [[Definition:Mergers and acquisitions (M&A) | M&A]] transaction — confirming that no [[Definition:Insurance claim | claims]] have been made, are pending, or are threatened under specified [[Definition:Insurance policy | insurance policies]] as of a stated date. In the context of buying or selling an insurance business, this declaration often appears as part of the [[Definition:Disclosure letter | disclosure exercise]] or as a standalone certificate required at closing, giving the buyer confidence that the [[Definition:Loss reserve | reserve]] position and [[Definition:Loss experience | loss experience]] presented during [[Definition:Due diligence | due diligence]] remain accurate. Outside of M&A, insurers themselves may require no-claim declarations from policyholders at renewal to validate [[Definition:No-claims bonus (NCB) | no-claims discount]] eligibility, particularly in personal lines such as [[Definition:Motor insurance | motor]] and [[Definition:Property insurance | property]] insurance.

🔍 In practice, the declaration operates as a snapshot warranty. The party making it attests — usually as of a cut-off date immediately prior to or on the day of signing or closing — that it has no knowledge of circumstances that could give rise to a claim, that no formal claim notifications have been submitted, and that no litigation or regulatory actions relating to covered risks are outstanding. In an insurance portfolio transfer or [[Definition:Share purchase agreement (SPA) | share deal]], the scope of the declaration is carefully negotiated: it may cover only policies written by the target entity or extend to [[Definition:Reinsurance | reinsurance]] contracts, [[Definition:Run-off | run-off]] books, and [[Definition:Delegated underwriting authority (DUA) | delegated authority]] arrangements. Buyers typically cross-reference the declaration against [[Definition:Bordereaux | bordereaux]] data, claims system extracts, and actuarial reports to verify its accuracy.

⚠️ The practical significance of a no-claim declaration lies in its role as a contractual safeguard and a trigger for [[Definition:Indemnity | indemnification]]. If a claim surfaces after closing that predates the declaration, the buyer can point to the seller's attestation as a basis for a [[Definition:Warranty and indemnity (W&I) | breach-of-warranty]] claim or seek recovery under specific indemnities carved out in the [[Definition:Purchase agreement | purchase agreement]]. Regulators in certain jurisdictions may also require outgoing carriers to confirm claim status when transferring [[Definition:Insurance portfolio | portfolios]] to protect [[Definition:Policyholder | policyholders]] from gaps in coverage. Because the stakes are high — undisclosed claims in [[Definition:Long-tail liability | long-tail]] lines such as [[Definition:Liability insurance | liability]] or [[Definition:Professional indemnity insurance | professional indemnity]] can emerge years later — the precision and scope of this declaration receive significant attention from legal counsel on both sides of the transaction.

'''Related concepts:'''
{{Div col|colwidth=20em}}
* [[Definition:Disclosure letter]]
* [[Definition:Warranty and indemnity (W&I)]]
* [[Definition:No-claims bonus (NCB)]]
* [[Definition:Loss reserve]]
* [[Definition:Insurance portfolio transfer (IPT)]]
* [[Definition:Due diligence]]
{{Div col end}}

Definition:No-claim declaration - Revision history

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