Some issues related to the content of the policyholder’s pre-contractual duty of disclosure – general view


The borderlines of the pre-contractual duty of disclosure imposed on the policyholder had been fixed first by Lord Mansfield some 250 years ago. During a long period of time the pre-contractual disclosure was the weak pointy of the policyholders since insurers could easily escape liability by availing themselves of the breach of duty. Indeed this was certainly the most breached duty given the fact that legal rules or court decisions placed on the policyholder the risk of correctly guessing what they were expected to disclose. In addition, the sanction to apply against the policyholder was very harsh (avoidance) and was not excluded in case of innocent breach. This situation detrimental to the policyholders changed only at the beginning of the new millennium. Nowadays the sanctions that may be applied are balanced. They include variation, decrease of the insurance money and termination; avoidance being totally excluded or permitted only in case of intentional breach. On the other hand negligent breach is a basic requirement and insurers are not anymore in a position to apply a sanction where the policyholder cannot be attributed any negligence in breaching the duty of disclosure. Parallel to those new solutions, the content of the duty did also undergo changes. Insurers are required to ask questions in order to learn about points relevant for their decision whether to accept the risk. If they don’t put questions in respect of some point, that point will be deemed “not relevant”. In the article below we will try to highlight some issues relating to the content of the pre-contractual disclosure duty still of utmost importance today.

Unan Samim