Presentation of the risk: interpretation of express presentation clauses

The Insurance Act 2015, which came into force on 12 August 2016, recasts the existing rules of utmost good faith set out in sections 17 to 20 of the Marine Insurance Act 1906 and replaces them with a regime based on proportional remedies rather than an absolute right for the insurers to avoid liability. Insurers have nevertheless long recognised that reliance on strict legal rights is not always appropriate, and express clauses modifying those rights are commonly found.

Mutual Energy Ltd v Starr Underwriting Agents Ltd and Another [2016] EWHC 590 (TCC) raised a preliminary issue on the proper interpretation of a provision that removed the right to avoid the policy other than for “deliberate or fraudulent non-disclosure or misrepresentation”.