Effect of a fraudulent claim

Yeganeh v Zurich plc [2010] EWHC 1185 (QB) is essentially a case on its facts. It does nevertheless raise some interesting questions as to the burden of proof in a fraudulent claims case and also the consequences of a fraudulent claim by the assured.

Yeganeh: the facts

The assured was insured by the insurers defendant under a buildings and contents policy entered into on 28 September 2006. The only material term for present purposes was the fraudulent claims clause, which provided: ‘If a claim is fraudulent or false in any way, we will not make any payment and all cover will end’. The assured’s house was destroyed by fire on the night of 14 September 2007. The cost of reinstatement was in excess of £270,000. The assured also submitted a claim for loss of clothes, to the value of £38,788, close to the contents indemnity limit of £40,000. The insurers denied liability. They prayed in aid the fraudulent claims claims, asserting that the assured had himself set the fire and, further, that the claim for clothes was excessive.