Author : John L Clark
Publisher : Unknown
Page : 130 pages
File Size : 41,8 Mb
Release : 2020-08-20
Category : Electronic
ISBN : 9798677087370
MARINE INSURANCE ACT 1906 Vs. INSURANCE ACT 2015 by John L Clark Pdf
A section-by-section critical comparison of the Marine Insurance Act 1906 and Insurance Act 2015, an analysis of the doctrine of uberrimæ fidei and a revision of selected cases brought before English courts both before and after the enactment of the new Act to identify a pattern of evolution towards modern adjudication of insurance matters. However, no suggestion for legislative reform is proffered herein. The Marine Insurance Act 1906 contains provisions dealing specifically with maritime matters which may be directly applicable to any contract of insurance by removing or replacing certain terms. The definition of a marine insurance contract in section 1, for example, "A contract of marine insurance is a contract whereby the insurer undertakes to indemnify the assured, in manner and to the extent thereby agreed, against marine losses, that is to say, the losses incident to marine adventure," could refer to any contract simply by deleting the word "marine." The bulk of the Marine Insurance Act articulates universal concepts and principles generally applicable to the entire insurance industry, namely disclosures and representations, warranties and loss, hence its global significance in that field for over a century, and its broad implementation and transposition in the legal systems of many Commonwealth nations. But despite its meticulousness and merits, a glaring point of contention is the infamous principle of uberrimæ fidei (or "utmost good faith") for insurance contracts set out in section 17, "A contract of marine insurance is a contract based upon the utmost good faith, and, if the utmost good faith be not observed by either party, the contract may be avoided by the other party," which originated in 1766 based on Lord Mansfield's comments in Carter v Boehm: "Insurance is a contract based upon speculation. The special facts, upon which the contingent chance is to be computed, lie most commonly in the knowledge of the insured only; the underwriter trusts to his representation and proceeds upon the confidence that he does not keep back any circumstance in his knowledge, to mislead the underwriter into a belief that the circumstance does not exist, and to induce him to estimate the risk as if it did not exist. Good faith forbids either party by concealing what he privately knows, to draw the other into a bargain from his ignorance of that fact, and his believing the contrary."Contrastingly, in a clear effort to democratise the legal framework for insurance contracts, the Insurance Act 2015 enshrines the duty of fair presentation in section 3, "Before a contract of insurance is entered into, the insured must make to the insurer a fair presentation of the risk," and effectively derogated the cumbersome "utmost good faith" precept to the dustbin of history in section 14, "Any rule of law permitting a party to a contract of insurance to avoid the contract on the ground that the utmost good faith has not been observed by the other party is abolished," boldly doing away with the archaic Latin expression. The Insurance Act also concisely provides for warranties and remedies for fraud in five succinct sections and abolishes so-called "basis of the contract" clauses in section 9, "This section applies to representations made by the insured [which are] not capable of being converted into a warranty by means of any provision of the non-consumer insurance contract (or of the terms of the variation), or of any other contract (and whether by declaring the representation to form the basis of the contract or otherwise)." by prohibiting the conversion of any representation by the insured into a warranty by means of contractual provision, which was originally obligated in Marine Insurance Act, section 35 (2), "An express warranty must be included in, or written upon, the policy, or must be contained in some document incorporated by reference into the policy."