Introduction
When concluding insurance contracts, applicants have a duty of disclosure. However, applicants need not disclose information unless the insurer enquires.
Insurers remedy for breach of this duty varies. They can either:
rescind the contract and keep the premium. The availability of this remedy depends on the degree of connection between the loss and the intention of the policyholder. If the policyholder deliberately breached this duty, the insurer can avoid the policy, refuse all claims and keep the premium; or
rescind the contract but return the premium. If the policyholder was merely negligent in breaching the duty, the insurer can avoid the contract but must return the premium.