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21 MISTAKE

Law of Insurance Contracts

Chapter 21 MISTAKE 21-1 INTRODUCTION A mistake by one or both parties to the contract of insurance will vitiate the contract, if the mistake is sufficiently serious. In this respect, the contract of insurance is like other contracts in that such mistakes do not arise very often. Further, circumstances giving rise to mistake will often give rise to other remedies, notably remedies for breach of warranty, misrepresentation or non-disclosure by the insured, remedies which are adequate and easier to obtain than relief based on mistake. The most important instance of mistake occurs when the policy does not accurately reflect the agreement of the parties, and the policy is rectified; ex hypothesi the contract is not vitiated. 1

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