The doctrine of telling all material data is embodied in the important principle ‘ utmost good faith ’ which applies to all forms of insurance.
Both parties to the insurance contract must agree( announcement idem) at the time of the contract. There shouldn't be any misrepresentation,non-disclosure or fraud concerning the material.
In case of insurance contract the legal sententia ‘ Caveat Emptor ”( let the buyer guard ) croakers not prevail, where it's the regard of the buyer to satisfy himself of the fictitiousness of the subject- matter and the dealer is under no obligation to supply information about it.
But in the insurance contract, the dealer, i.e., the insurer will also have to expose all the material data.
An insurance contract is a contract of uherrimae fidei, i.e., of absolute good faith both parties to the contract must expose all the material data and completely.
A material fact is one which affects the judgment or decision of both parties in entering into the contract.
Data which count materially are those which knowledge influences a party in deciding whether or not to offer or to accept similar threat and if the threat, is respectable, on what terms and conditions the threat should be accepted.
These data have a direct bearing on the degree of threat about the subject of insurance.
In case of life insurance, the material data or factors affecting the threat will be age, hearthstone, occupation, health, income,etc., and in case of property insurance, it would make him use the design, proprietor, and situation of the property.
The utmost Good Faith says that all the material data should be bared in true and fill the form. It means that the data should be bared in that form in which they live.
There should be no concealment, misrepresentation, mistake or fraud about the material data. There should be no false statement and no half- verity nor nay silence on the material data.
The duty to expose the material data lies on both the parties the ensured as well as the insurer, but in practice the assured has to be more particular, about the; observance of this principle because it's generally in full knowledge of data relating to the subject- matter which, despite all effective examinations of the insurer, would not be bared.
The following facts, however, are not required to be disclosed by the insured (0 Facts which tend to lessen the risk.
As a rule, all insurance contracts except personal insurance are contracts of indemnity.
According to this principle, the insurer undertakes to put the ensured, in the event of loss, in the same position that he enthralled incontinently before the passing of the event ensured against, in a certain form of insurance, the principle of reprisal is modified to apply.
For illustration, in marine or fire insurance, occasionally, a certain profit periphery which would have earned in the absence of the event, is also included in the loss. In a true sense of the reprisal, the ensured isn't entitled to make a profit from his loss.
The ensuing conditions should be fulfilled in full operation of the principle of reprisal.
The doctrine of subrogation refers to the right of the insurer to stand in the place of the ensured, after the agreement of a claim, in so far as the insured’s right of recovery from an indispensable source is involved.
still, his right of recovery is subrogated to the insurer on the agreement of the claim, If the ensured is in a position to recover the loss in full or in part from a third party due to whose negligence the loss may have been rained.
The insurers, after that, recover the claim from the third party. The right of subrogation may be exercised by the insurer before payment of loss.