header-logo header-logo

Contract revolution

18 January 2007 / Tracey Anderson , Katy-marie Wilson
Issue: 7256 / Categories: Features , Insurance / reinsurance
printer mail-detail

Katy-Marie Wilson and Tracey Anderson
report on major changes to insurance contract law

Plans to review insurance contract law were announced in January 2006 by the English and Scottish Law Commissions (the commissions) and recommendations will be published in 2007.

All insurance contracts are based on the duty of utmost good faith. The applicability of the principle as regards disclosure of material circumstances and the making of material misrepresentations is set out in the Marine Insurance Act 1906. A circumstance is deemed to be ‘material’ if it is one that would affect the judgment of the (re)insurer in assessing the risk even if, ultimately, it would not have a decisive effect on the (re)insurer’s acceptance of the risk or on the amount of premium charged.

The remedy for breach of the duty is avoidance of the contract, irrespective of whether the breach was made innocently, negligently or fraudulently. However, before a (re)insurer can avoid, it must be shown that the non-disclosure/ misrepresentation actually induced the underwriter to accept the contract on the relevant terms.

Consumer

If you are not a subscriber, subscribe now to read this content
If you are already a subscriber sign in
...or Register for two weeks' free access to subscriber content

MOVERS & SHAKERS

Slater Heelis—Chester office

Slater Heelis—Chester office

North West presence strengthened with Chester office launch

Cooke, Young & Keidan—Elizabeth Meade

Cooke, Young & Keidan—Elizabeth Meade

Firm grows commercial disputes expertise with partner promotion

CBI South-East Council—Mike Wilson

CBI South-East Council—Mike Wilson

Blake Morgan managing partner appointed chair of CBI South-East Council

NEWS
The House of Lords has set up a select committee to examine assisted dying, which will delay the Terminally Ill Adults (End of Life) Bill
The proposed £11bn redress scheme following the Supreme Court’s motor finance rulings is analysed in this week’s NLJ by Fred Philpott of Gough Square Chambers
In this week's issue, Stephen Gold, NLJ columnist and former district judge, surveys another eclectic fortnight in procedure. With humour and humanity, he reminds readers that beneath the procedural dust, the law still changes lives
Generative AI isn’t the villain of the courtroom—it’s the misunderstanding of it that’s dangerous, argues Dr Alan Ma of Birmingham City University and the Birmingham Law Society in this week's NLJ
James Naylor of Naylor Solicitors dissects the government’s plan to outlaw upward-only rent review (UORR) clauses in new commercial leases under Schedule 31 of the English Devolution and Community Empowerment Bill, in this week's NLJ. The reform, he explains, marks a seismic shift in landlord-tenant power dynamics: rents will no longer rise inexorably, and tenants gain statutory caps and procedural rights
back-to-top-scroll