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Last edited 29 Jun 2017
Misrepresentation and insurance
When taking out an insurance policy, it might seem tempting to minimise the risk insured against with a view to reducing the premium. However, a recent High Court case concerning a catastrophic property fire showed why absolute frankness is required.
When applying for the insurance, the owners had described the property as in good repair. However, the Court noted evidence that, among other things, many of its windows were broken or falling out and that its roof leaked.
In refusing to order the insurers to indemnify the owners for their loss, the Court noted that the latter had made no real effort to fairly represent the risk. Had they done so, the insurers would probably have declined cover.
In the circumstances, the insurers were entitled to avoid the policy and tender the return of the premium.
 Find out more
 Related articles on Designing Buildings Wiki
- Caveat emptor in property sales.
- Directors and officers insurance.
- Employer's liability insurance.
- Excepted risk.
- Failure to mention asbestos.
- Failure to notify tenant.
- Legal indemnity insurance.
- Material non-disclosure.
- Non-negligent liability insurance.
- Property disrepair and landlord liabilities.
- Specified perils.
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