The extent of the insured’s duty of disclosure: a ...

The extent of the insured¡¯s duty of disclosure:

a comparative analysis of the disclosure obligations of insured

in Australia, Singapore and China

Wei Song

LLB

Lawyer NSW, NT

Faculty of Law

Queensland University of Technology

2012

KEYWORDS

Acts, Dispute, Common Law, Claims, Court, Duty of Disclosure, Fraud, General

Insurance, Jurisdiction, Judges, Insurance Policy, Insurance Contracts, Insurer,

Insured, Law Reform Commission, Legislation, Life Insurance, Non-disclosure,

Misrepresentation, Misleading, Obligations, Regulators, Utmost Good Faith,

Australia, Singapore, People¡¯s Republic of China, Hong Kong.

ii

ABSTRACT

Pre-contractual material disclosure and representation from an insurance policy

proposer is the most important element for insurers to make a decision on whether

a proposer is insurable and what are the terms and conditions if the proposal by the

proposer is able to be insured.

The issue this thesis researches and investigates focus on the issues related to the

pre-contractual non-disclosures and misrepresentations of an insured under the

principle of utmost good faith, by operation of laws, can achieve with different

results in different jurisdiction. A similar disputed claim involving material nondisclosed personal information or misrepresentation at the pre-contractual stage

from an insured with respect to both general and life insurance policies settled by

an insurer in Australia could be that the policy is set aside ab initio by the insurers in

Singapore or China.

The jurisdictions this thesis examines are

?

Australia;

?

Singapore; and

?

China including Hong Kong.

iii

TABLE OF CONTENTS

KEYWORDS

ii

ABSTRACT

iii

LIST OF STATUTES

vii

ABBREVIATIONS

ix

DECLARATION

x

1 INTRODUCTION

1

2 INSURANCE LAW OF AUSTRALIA

6

2.1 The Sources of Insurance Law in Australia

6

2.2 Contract of Insurance at Common Law

9

2.3 Duty of Utmost Good Faith at Common Law

11

2.4 Duty of Utmost Good Faith under the ICA

15

2.5 Duty of Disclosure and Misrepresentation at Common Law

16

2.6 Duty of Disclosure under the ICA

23

2.7 Misrepresentation under the ICA

29

2.8 The Insurer¡¯s Duty of Notification under the ICA

32

2.9 Remedies for Non-Disclosure and Misrepresentation

under the ICA

2.10 Section 56 of the ICA

34

39

2.11 The Duty of Utmost Good Faith and its application to a

Third Party

2.12 Reinsurance

41

44

iv

2.13

Conclusions

3 GOVERNMENT REVIEW OF THE ICA

3.1 The Insurance Contracts Amendment Bill 2010

45

47

49

3.2 Utmost Good Faith under the Insurance Contracts Amendment

Bill 2010

50

3.3 Disclosure and Misrepresentations under the Insurance

Contracts Amendment Bill 2010

51

3.4 Notice to an Insured of Duty of Disclosure under the Insurance

Contracts Amendment Bill 2010

3.5 Proposed reforms to the Remedies for Non-disclosure and

53

54

Misrepresentation under the Insurance Contracts

Amendment Bill 2010

3.6 Conclusions

54

4 SINGAPORE INSURANCE LAW

55

4.1 The Insurance Law of Singapore

55

4.2 Legal Requirement for an Insurance Contract under

Singapore Law

55

4.3 Duty of Disclosure under the Principle of the Utmost

Good Faith

56

4.4 Insurers¡¯ Duty of Notification

59

4.5 Insured¡¯s Duty of Disclosure

61

4.6 How Singapore Courts Apply the Principle of Duty of

Disclosure to Claims

63

v

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