ZELLER V BRITISH CAYMANIAN INSURANCE CO LTD

[2008] UKPC 4, Privy Council, Lord Bingham of Cornhill, Lord Hope of Craighead, Baroness Hale of Richmond Lord Carswell and Sir Henry Brooke 16 January 2008

Insurance (health) – Group life policy – Utmost good faith – Misrepresentation – Breach of warranty – Assured not disclosing heart condition – Whether assured making disclosure to best of knowledge and belief

The claimant completed an application form for entry into his employer’s group health scheme. The assured was required to answer questions to the best of his knowledge and belief. In response to specific questions about his health, he disclosed a thyroid problem. He also stated that he was in good health and had not consulted a doctor. Subsequently the assured was diagnosed with a heart murmur, and he claimed the medical expenses from the insurers. Liability was denied on the basis that the assured had misrepresented the state of his health. The Privy Council held that the only question was whether the assured had honestly believed that he was in good health, and that because that was the case he could not be guilty of misrepresentation.