Cover Story - Uberrimae Fides in Marine Insurance Contracts
Source: Asia Insurance Review | Sep 2006
A marine insurance
contract is a contract uberrimae fidei – it is a contract based on utmost
good faith, such that if either party does not observe this, it will allow the
other party to avoid the contract. Mr Sin Lye Kuen, Partner in DLA Piper
Rudnick Gray Cary’s Singapore office, comments on the robust application
of the doctrine of utmost good faith to non-disclosures by insured parties,
in the recent English Court of Appeal decision of North Star Shipping Ltd and
Others v Sphere Drake Insurance plc and others (No 2) [2006] EWCA Civ 378, and
how this might lead to potential difficulties for future claims by insured parties.
It is important for the Asian marine market to appreciate the ambit of their
duties of disclosure following the English Court of Appeal’s decision,
given that the decision is persuasive authority which will likely be followed
by the major Commonwealth jurisdictions around the world.
Archived articles are available to Magazine subscribers only.
For Full Access to
the magazine
SUBSCRIBE here.