The Law Commission has published the responses it has received to Issues Paper 7: The Insured’s Post-Contractual Duty of Good Faith. The Commission received 33 responses in total with the majority coming, not surprisingly, from the insurance and legal sectors.

The Commission noted that, in practice, a policyholder’s main post-contractual duty is to act honestly when making a claim. Those responding to the issues paper told the Commission that, among other things, insurance fraud is particularly damaging to both the insurance industry, with the Association of British Insurers noting that in 2009 insurers detected £841 million of general insurance fraud, and to consumers, with the cost of such fraud being passed on to insureds by way of higher premiums. Also of note is the large consensus that the law on an insurer’s remedies for fraud “was unnecessarily complex” and many respondents believe that this area should be reformed by way of legislation to clarify the insurer’s remedy for a fraudulent claim.

For a link to the responses please click here and for a link to Issues Paper 7 please click here.