2.3 Parties, Principles of Good Faith in Contracts, Disclosure and Representation of Insurance Contract

The parties: the insurer (the licensed company); the insured/proprietor (the policyholder); the beneficiary (the life policy's nominee — the payment's recipient); the intermediaries (the agent- broker-surveyor of U7); the reinsurer (the background risk-bearer). The utmost good faith (uberrimae fidei): the insurance's cardinal doctrine — both parties (especially the insured) must disclose the material facts; the reason (the information's asymmetry — the insurer knows the risk only through the insured's eyes). The disclosure's duty: the material facts (the facts influencing the prudent insurer's decision) must be disclosed voluntarily — no questions asked; the insured's continuing duty (the risk's alteration faces). The representation: the statements in the proposal form — the true-and-complete duty; the innocent misrepresentation's avoidability (the insurance's strictness vs the ordinary contract's fraud-only voidability). The remedies: the policy's avoidance; the claim's repudiation; the premium's return (the fraud faces).