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  1. #1
    Join Date
    Apr 2019
    Posts
    6

    Default Misrepresentation to an Insurance Company

    What does Section 28(1) of Insurance Contracts Act 1984 (Cth) mean?
    Quote Quoting 28 General insurance
    (1) This section applies where the person who became the insured under a contract of general insurance upon the contract being entered into:

    (a) failed to comply with the duty of disclosure; or

    (b) made a misrepresentation to the insurer before the contract was entered into; but does not apply where the insurer would have entered into the contract, for the same premium and on the same terms and conditions, even if the insured had not failed to comply with the duty of disclosure or had not made the misrepresentation before the contract was entered into.

  2. #2
    Join Date
    Jan 2006
    Posts
    38,323

    Default Re: Is Anyone Able to Decipher This Statute

    More Australian law?

    First, interpreting Australian or UK law is not the same as interpreting US law. The definitions and terminology is unique to each jurisdictions laws.

    Second; laws are taken in whole. You don’t read an individual section and interpret it without all associated law. It can result in some very incorrect interpretations.

  3. #3
    Join Date
    Apr 2019
    Posts
    6

    Default Re: Is Anyone Able to Decipher This Statute

    Here's the gist of it... If a person wanting to insure something (insured) makes a misrepresentation when they fill the form, or breaches their duty to disclose relevant matters, the party offering to insure them (insurer) can deny their claim.

    But then we have this part..."but does not apply where the insurer would have entered into the contract, for the same premium and on the same terms and conditions, even if the insured had not failed to comply with the duty of disclosure or had not made the misrepresentation before the contract was entered into."

    Premium = yearly insurance payments

  4. #4
    Join Date
    Mar 2013
    Posts
    16,741

    Default Re: Is Anyone Able to Decipher This Statute

    To be material under U.S. law, upon the initial underwriting of the risk the insurance company would have either:

    1 - Refused to write the policy.
    2 - Charged more for the policy.
    3 - Modified the policy with additional exclusions or limitations.

    Or a combination of 2 and 3.

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