Uberrima fides


Uberrima fides

"Uberrima fides" (sometimes seen in its genitive form uberrimae fidei) is a Latin phrase meaning "utmost good faith" (literally, "most abundant faith"). It is the name of a legal doctrine which governs insurance contracts. This means that all parties to an insurance contract must deal in good faith, making a full declaration of all material facts in the insurance proposal. This contrasts with the legal doctrine of "caveat emptor" (let the buyer beware).

Thus the insured must reveal the exact nature and potential of the risks that he transfers to the insurer, while at the same time the insurer must make sure that the potential contract fits the needs of, and benefits, the assured.

A higher duty is exacted from parties to an insurance contract than from parties to most other contracts in order to ensure the disclosure of all material facts so that the contract may accurately reflect the actual risk being undertaken. The principles underlying this rule were stated by Lord Mansfield in the leading and often quoted case of Carter v Boehm (1766), 97 E.R. 1162 (K.B.) at 1164:

Insurance is a contract of speculation... The special facts, upon which the contingent chance is to be computed, lie most commonly in the knowledge of the insured only: the under-writer trusts to his representation, and proceeds upon confidence that he does not keep back any circumstances in his knowledge, to mislead the under-writer into a belief that the circumstance does not exist... Good faith forbids either party by concealing what he privately knows, to draw the other into a bargain from his ignorance of that fact, and his believing the contrary.
See, generally, Parkington, ed., MacGillivray and Parkington On Insurance Law, 8th ed. (1988) para. 544; Brown and Menezes, Insurance Law in Canada, 2d ed. (1991) pp. 8-9; and 25 Halsbury's Laws of England, 4th ed. para. 365 et seq.

The fact that a contract is one of utmost good faith does not however mean that it gives rise to a general fiduciary relationship. The relationship between insured and insurer is not akin to the relationship between, say, guardian and ward, principal and agent, or trustee and beneficiary. In these latter instances, the inherent character of the relationship is such that the law has traditionally imported general fiduciary obligations. The insurer-insured relationship is contractual; the parties are parties to an arms-length agreement. The principle of uberrima fides does not affect the arms-length nature of the agreement, and cannot be used to find a general fiduciary relationship. The insurance contract, as noted above, imposes certain specific obligations on its parties. These obligations, however, do not import general fiduciary duties into each and every insurance relationship. Before such fiduciary obligations can be imported there must be specific circumstances in the relationship that call for their imposition.

External links

* [http://www.mlaus.org/article.ihtml?id=572&issue=40&folder=0 Uberrima Fides And Concealment in the Marine Policy Application] from the Maritime Law Association of the United States
*" [http://www.ca9.uscourts.gov/ca9/newopinions.nsf/6C903EFFD869B353882574120005C0BE/$file/0655031.pdf?openelement New Hampshire Ins. v. C'Est Moi, Inc.] "


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  • uberrima fides — uber·ri·ma fi·des /yü ber i mə fī ˌdēz, ü ber ē ˌmä fē ˌdās/ n [Latin, most abundant good faith]: utmost or perfect good faith acted in uberrima fides ◇ The terms uberrima fides and uberrimae fidei, although grammatically distinct in Latin, are… …   Law dictionary

  • uberrima fides — yüˈberəməˈfī(ˌ)dēz noun Etymology: Latin, literally, most abundant faith : good faith the rights of the parties … should be interpreted in a spirit of uberrima fides H.B.Brown …   Useful english dictionary

  • uberrima fides — See utmost good faith …   Big dictionary of business and management

  • uberrima fides — /yuwbehrama faydiyz/ Lat. The most abundant good faith; absolute and perfect candor or openness and honesty; the absence of any concealment or deception, however slight. A phrase used to express the perfect good faith, concealing nothing, with… …   Black's law dictionary

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  • fides — /faydiyz/ Faith; honesty; confidence; trust; veracity; honor. Occurring in the phrases bona fides (good faith), mala fides (bad faith), and uberrima fides (the utmost or most abundant good faith) …   Black's law dictionary

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  • utmost good faith — uberrima fides The fundamental principle of insurance practice, requiring that a person wishing to take out an insurance cover must provide all the information the insurer needs to calculate the correct premium for the risk involved. Nothing must …   Big dictionary of business and management

  • William Murray, 1st Earl of Mansfield — For descendants of the first Lord Mansfield, see Earl of Mansfield and Mansfield. The Right Honourable The Earl of Mansfield SL …   Wikipedia