Commercial Court upholds right of insurer to avoid policy for misrepresentation and non-disclosure

In Dalecroft Properties Ltd v Underwriters [2017] EWHC 1263 (Comm), Mr Richard Salter QC (sitting as a Deputy Judge of the High Court) confirmed the defendant insurers’ right to avoid a property insurance policy following various misrepresentations relating to the state of repair of the insured property and non-disclosures relating to acts of vandalism to the property. The property in question was subsequently destroyed by fire and a claim was made by the insured. In response, the insurers purported to avoid the policy. On the facts, it was held that there were material misrepresentations and that material non-disclosures were made, such that the insurers were entitled to avoid the policy.

The insurance policies at issue were entered into prior to the coming into force of the Insurance Act 2015, such that the old law applied in this case. It is noteworthy, however, that the judge commented that even under the 2015 Act, the insured’s claim would have failed, on the basis that there was no fair presentation of the risk (as that expression is now defined in the 2015 Act) and that the defendant insurers would have declined to write the risk at all had a fair presentation been made.

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