The Principle of utmost good faith

Question

Question: The principle of utmost good faith

Options:

1.  Holds only the insurer to a higher standard of honesty in the execution of the insurance contract
2.  Generally does not apply in health insurance since these covers are administered under group underwriting
3.  Requires that the insurer fulfill on the promises made in the insurance contact, and that the insured provide accurate information on the insurance application and not withhold information considered material to the contract
4.  Means that there will be an inequality between the actual value of payments amongst the policy participants
5.  Requires that the insurer provide the insured with a written contract in order for the policy to come into existence

Answer 1

3. Requires that the insurer fulfill on the promises made in the insurance contact, and that the insured provide accurate information on the insurance application and not withhold information considered material to the contract

The principle of utmost good faith requires that the insurer fulfill on the promises made in the insurance contact, and that the insured provide accurate information on the insurance application and not withhold information considered material to the contract.