Research About The Insured' Disclosure Obligations

The disclosure obligations, as a conventional and unique part of the insurance practice, constitute the cornerstone of a functional insurance system. The industry cannot expect smooth operations and significant development without such obligations; meanwhile, however, this is the most controversial part in both business and theoretical research activities. In today's sustained insurance development in China, how to protect the insured's interests and keep in line with the principle to balance the interests of all parties to an insurance contract in order to establish a mutual consideration means more in the relevant research than ever before. This article looks back into their evolution history and examines the legislative basis and probes into questions as to what is the basis for their existence? Are they still indispensable in today's insurance industry that is undergoing a significant change? How to further develop relevant rules to promote the development of China's insurance industry?In this article, the author presents her arguments by using historical and comparison methods, with references to legislative experiences or theories from foreign countries and Taiwan district of China, and a combination of relevant laws and practical conditions in China.This article is divided into five parts:Part 1: General theory. The author first examines the implications and nature of the disclosure obligations, then looks back to their history and legislative evolution, and in the end, through an analysis of the nature and the unbalanced information flow inherent in insurance industry, the author concludes that disclosure obligations are an indispensable part in insurance system both in the past and at present.Part 2: Legislative basis. Based on various theories established by two leading law families, the author gives her own points of view, claiming that the legislative basis for modern disclosure obligations shall be 'utmost good faith' and 'mutual consideration'.Part 3: Fundamental framework. Based on provisions and various theories established by two leading law families with regard to the basic elements of the disclosure obligations system, i.e. the disclosure subject, performance period and terms, etc., the author makes an analysis of the deficiencies in fundamental framework for the disclosure obligations under the China insurance law.Part 4: Consequences of violation of disclosure obligations. Through comparisons of the provisions and theories established by two leading law families, the author examines the defects and omissions found in China's insurance law.Part 5: Enhancements required. Based on analysis of the examinations made above, the author makes recommendations for enhancements, and in the end, presents some recommended revised provisions for comment.