Insurance Law Information Disclosure System

This thesis adopts a comparative approach to conduct an in-depth analysis of the duty to disclose in the insurance laws. It focuses on the comparison between Anglo-American insurance laws and the Chinese insurance law, so as to explore the solutions to the problem of asymmetric information between the insureds and the insurers. Under the Anglo-American system, an applicant's duty to disclose before any insurance contract taking effects includes: warranty, representation and non-concealment. Warranty is one of the oldest rules in the insurance law, and its history could be traced back to the origin of marine insurance. Warranty has to be strictly complied with; any breach of warranty will void the policy regardless of its graveness and its actual effect. Representation, on the other hand, is a rather reasonable requirement in that although the insurer could void the police on the grounds of the applicant's misrepresentation, the insurer has to prove materiality, actual reliance and the resulting harm. Similarly, concealment could also make the applicant lose coverage; but in addition to the aforesaid three elements, the insurer is also required to prove intents. Due to the excessive harshness caused by the law of warranty, modern Anglo-American insurance law has made substantial reform via case law and statutes; the result is that today, an applicant's duty to disclose is primarily governed by the law of representation and the law of concealment. These two sets of rules have enabled insurers to greatly lower their underwriting costs by two means: the questionnaire-type of application forms and the post-loss investigation, which provides security and convenience to insurance transactions, and helps to solve the problem of imperfect information. The Chinese insurance law borrowed heavily from the Anglo-American insurance law, and although the law of warranty is in absence, it does provide for the law of representation, and elaborate concealment is deemed an act of misrepresentation. However, when applying these rules to actual cases, the inexperienced Chinese courts are facing many unexpected problems. There have been ready answers in the Anglo-American insurance law to solve these problems. Therefore we need to learn from the established rules in those countries to perfect our own.