Law of Insurance, Ubberimae Fidei

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Submitted By kimberleynimo
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Uberrimae Fidei is a legal doctrine governing insurance contracts which means “utmost good faith". This means that all parties to an insurance contract must deal in good faith, making a full declaration of all material facts in the insurance proposal. Something is material if it would influence a prudent insurer in determining whether to write a risk, and if so upon what terms. If the party being insured does not reveal everything material about the risk or misrepresents material facts then the insurer may treat the policy as having been void from inception.The test of materiality is whether that fact would have influenced a prudent insurer in his decision to accept the risk and the premium to charge and this applies to both intentional and innocent failure to disclose facts¬¬.
The concept of Uberrimae Fidei has its origins in English law maritime insurance. The concept was grounded in morality and efficiency where both parties were morally expected to reveal all information pertinent to the contract. Even when certain information is not specifically requested the insured was, and still is, under a moral obligation to disclose all information that could be relevant to the insurer’s decision to provide coverage.
The requirement of Uberrimae Fidei is important in maintaining the integrity of the insurance field. If this were not a requirement, being in the nature of people to want to gain most reward, parties entering into an insurance contract would misrepresent or out rightly leave out information so as to get coverage at a low premium. With a lot of fraudulent policies the insurers resources would be stretched too thin to handle the genuine claims. As such a court of competent jurisdiction will check whether the insured left out pertinent information while getting the cover when the claims are contested by the…...

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