LL.M. Transnational Commercial law- Aspects of Insurance Essay

LL.M. Transnational Commercial law- Aspects of Insurance - Essay Example He said; Lord Mustill recently reviewed the history of good faith and the need to ensure full disclosure in the case of Pan Atlantic Insurance Co v Pine Top Insurance Co4, where he pointed out that the formulation of insurance policy is largely dependent upon information furnished before the execution of the contract, therefore the inequality of information may be addressed only by full disclosure of all relevant information. In Australia, Section 21 of the Insurance Contracts Act of 1984 (Cth) clearly lays out the scope of duty of a party that is purchasing insurance to disclose all the information that may be relevant to an insurer. This would include all information that is necessary for the insurer to make an objective assessment of the situation in order to decide whether or not it is prepared to accept the risk that is involved. In the recent case of McCabe v Royal and Sun Alliance Life Assurance Australia Ltd5 1, Mrs McCabe applied for insurance, but her condition was diagnosed only after she had sent in her preliminary application. But although Ms McCabe was hospitalized subsequently, she did not submit her doctor’s report to the insurance Company not disclose details of her illness and hospitalization. In this case, the Court held that the insurance Company was entitled to avoid the policy because Mrs McCabe had not fully disclosed all the relevant information about her health which was v ital to the insurer in making a determination about insuring her life. While a person seeking insurance is entitled to expect that an insurance Company will conduct its own independent analysis in making an assessment about the risk, the person seeking insurance also has a duty to provide all relevant information and a failure to do so would provide grounds for avoidance of the policy. The nature of non disclosure is also