Principle of utmost good faith

Question 1

What is utmost good faith?

Answer 1

Positive duty to voluntarily disclose all facts material to the risk.

Question 2

Which cases summarises utmost good faith?

Answer 2

Rozanes v Bowen - UW knows nothing so it’s the duty of the customer to disclose material facts to the insurer

Question 3

When is duty of disclosure revived?

Answer 3

At each renewal

Question 4

Which act defines a material fact?

Answer 4

Marine Insurance Act

Question 5

What is a material fact?

Answer 5

Something which would influence the judgement of a prudent insurer in assessing risk

Question 6

What is the insured’s duty of disclosure?

Answer 6

To make complete and full disclosure of all material facts

Question 7

Which case explained duty of disclosure in insurance contracts?

Answer 7

Carter v Boehm

Question 8

What is the insurer’s duty of disclosure?

Answer 8

Notify customers of potential premium discounts, only taking on risks it’s registered to accept and ensuring all statements are true (misleading a customer about policy cover is a breach of utmost good faith as stated in Kettlewell v Refuge Assurance Company)

Question 9

Which case stated that misleading a customer about policy cover is a breach of utmost good faith?

Answer 9

Kettlewell v Refuge Assurance Company