Study On The Principle Of Utmost Good Faith In Marine Insurance

Britain is not only a large trade country, but also a powerful shipping country. Marine insurance laws in Britain serve for sustainable development of the nation's shipping industry. Among them, Marine Insurance Act 1906 is famous for its stringency. Marine insurance industry in China has recently fallen into the predicament of the Lack of Faith. On the one hand, some insurance companies mislead and deceive the applicants for insurance (or the insured) in order to improve short-term sales; on the other hand, some applicants for insurance make false claims at times. These unhealthy factors are restricting the development of the marine insurance industry and even the whole insurance industry in China. Viewing from the range of the world, domestic marine insurance industry is facing unprecedented opportunities and challenges, therefore, we should make efforts to expand international influence and competitiveness in marine insurance market. Good faith is the root of enterprise competition, economic development and social stability, it also provides support and protection to avoid faith crisis. So we should use UK and other countries'laws for reference, establish utmost good faith and further improve related contents in marine insurance laws.We firstly in chapter one introduce the study background, purpose and the current situation of domestic and foreign scholars on the principle of utmost good faith. In chapter two, we describe the connotation of the principle of good faith and utmost good faith respectively, point out the connotation is in the process of continuous development, and discuss the distinctions and connections. In chapter three, first of all, we introduce several countries'legislations on the principle of utmost good faith, then mainly analyze stipulations and application process of utmost good faith in Marine Insurance Act 1906. This will help us to understand the nature of the principle of utmost good faith. In chapter four, we discuss utmost good faith's constrains on both parties. Through the insured person's notice, warranty and increased risk notification obligations and the insurer's explanation, waiver and estoppel obligations, we therefore conclude that in essence utmost good faith is the hub of both parties with the purpose to balance the interests of two sides. In the final chapter, we expound the embodiment of utmost good faith in the new Insurance Law of P. R. C, suggest utmost good faith should be clear established and defined, and some details, such as implied warranties, etc. should be specified in China.