The purpose of the 'Material Change' condition in insurance is to...

The purpose of the 'Material Change' condition in insurance primarily revolves around ensuring ongoing disclosure of risk. This condition mandates that policyholders must inform their insurer of any significant changes in their circumstances or the risk associated with the insured item.

It's essential for both the insurer and the insured to have a clear understanding of the risks involved throughout the duration of the policy. When a material change occurs, it can affect the insurer's willingness to provide coverage, the terms under which coverage is provided, and the premium rates. By requiring ongoing disclosure, the insurer can adequately assess the risk and adjust coverage or premiums accordingly.

This process helps maintain the integrity of the insurance contract, ensuring that the insurer is not unexpectedly exposed to higher risks without being aware of them. Being transparent about any changes allows for informed decision-making for both parties, which is fundamental in insurance contracts.