Statutory Assistance on the Doctrine of Utmost Good Faith?
It is perhaps useful to commence discussion with an inquiry into whether there exists any statutory assistance on the doctrine of utmost good faith. The statutory origins of Anglo-West Indian insurance law lie in the United Kingdom’s Life Assurance Act of 1774,6 the Gaming Act of 1845,[353] the Married Women’s Property Act 1882[354] and the Marine Insurance Act 1906.[355] This eighteenth and nineteenth century United Kingdom legislation represents the foundation of Caribbean insurance law and the extent to which it continues to be relevant today, is dependent on whether the jurisdiction has embraced the Caribbean Law Institute (CLI) initiative.[356] The CLI Insurance Bill has been implemented in Barbados,[357] Guyana,[358] Jamaica,[359] and in St Vincent and the Grenadines[360] and, perhaps prompted by the current economic crises, more recently in St Kitts and Nevis[361] and the Commonwealth of The Bahamas.[362] Representing the stimulus for the emancipation of insurance law from its colonial roots towards a more indigenous regime, the CLI model has two notable features.
One is its distinct financial rationale so that in territories which have enacted the model bill, insurers are subject, inter alia, to increased financial obligations relating to stipulated deposits,[363] statutory funds,[364] and share capital,[365] while additionally, the regulator’s powers have been significantly enhanced.[366] The critical underlying objective of the reform is solvency, namely, to ensure the insurer’s ability to satisfy his obligations when they become due. Coupled with stringent monetary controls, the Insurance model contains an acute social purpose rendering the legislation culturally relevant by recognizing spousal relationships for the purposes of insurable interest[367] and the status of the beneficiary.[368]As laudable as the briefly highlighted reform measures may be, regional insurance legislation is silent on the issue of utmost good faith.[369] Consequently, apart from ancillary rehabilitation of offenders legislation discussed below,[370] statutory assistance must be gathered from residual marine insurance legislation.
In this regard, overall there is a conspicuous underutilization and/or appreciation for the Marine Insurance Act of 1906[371] and or its regional equivalent.[372] The claim that regional jurisprudence fails to acknowledge the importance of the Marine Insurance Act, can only be supported if there is an acceptance that the Act is critical to an understanding of insurance law and more specifically the doctrine of uberrimae fidei. Marine insurance legislation, as evidenced by the common law is often the source of debate and contention.[373] The Act is of broad application for notwithstanding its title, it extends beyond the boundaries of marine insurance[374] there being no difference between marine and non-marine insurance in this respect.[375] Apart from providing the foundation for an analysis of the duty of utmost good faith, it illuminates on several other aspects of insurance and hence represents more than a convenient starting point as borne out in subsequent discussion. While the precise origin of the seemingly unlimited requirement of �utmost good faith’ derived from the idea of uberrimae fidei, in the side note, remains a mystery,[376] the Act, constitutes the driving force behind the broad formulation of the duty that exists at common law today.The utility of the marine insurance legislation was recognized by Justice Kissoon, in Ali (Somat) v Hand-in-Hand Mutual Fire & Life Insurance Co Ltd,[377] who set out in some detail the corresponding provisions in the United Kingdom equivalent. Here, the Court of Appeal used the Act as the framework to answer inquiries into materiality, the nature of the duty of utmost good faith and the effect of breach. Moreover, perhaps as noted, since regional case law exhibits an unmistaken reverence for the seminal House of Lords decision of Pan Atlantic Insurance Co Ltd v Pine Top Insurance Co Ltd,[378] a decision which, inter alia, relied heavily on the Marine Insurance Act, then perhaps albeit by a somewhat circuitous route, there is tacit acceptance of its relevance to the region. In a climate where insurance legislation is either ignored and/or is of little utility to the question of uberrimae fidei as in the case of CLI driven reform, it is easy to understand why a great deal of reliance must be placed on the common law.
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