Sandeep had availed Housing Loan from SBI through whom he had been enrolled as a member of a Group Insurance Scheme on 12.09.2016, specifically designed for Housing Loan Borrowers of SBI group by SBI Life Ins. Co. In the

Material fact: Material fact is a fact that is important, significant or essential to a reasonable person in deciding whether to engage or not to engage in a particular transaction, issue or matter at hand. The term material fact is also used to distinguish the unimportant or trivial detail. For example, in an insurance fraud case, a material fact would relate to the insurer's liability, policy, or coverage. If a fact is material, it will likely impact the outcome of the case in court. The concept of material fact is related to the principle of utmost good faith. Principle of Uberrimae Fidei (Utmost Good Faith): The Principle of Uberrimae fidei (a Latin phrase), or in simple English words, the Principle of Utmost Good Faith, is a very basic and first primary principle of insurance. According to this principle, the insurance contract must be signed by both parties (i.e. insurer and insured) in an absolute good faith or belief or trust. The person getting insured must willingly disclose and surrender to the insurer his complete true information regarding the subject matter of insurance. The insurer's liability gets void (i.e. legally revoked or cancelled) if any facts, about the subject matter of insurance are either omitted, hidden, falsified or presented in a wrong manner by the insured. When Mr. Sandeep joined Housing Loan Borrowers of SBI group insurance he was in good health and the same was mentioned in the insurance policy. He was never hospitalized for any critical illness or any treatment required medical treatment before the date he applied for insurance. So the insurance signed between two parties was in good faith. Representations: Representations are statements made during the negotiations with the object of inducing the other party to enter into the contract i.e. they must be distinguished from statements which are introduced into the contract, and upon the truth of which the validity of the contract is made to depend. Representations may be as to a matter of fact, and, if material must be substantially correct. Facts, Which Must Be Disclosed Facts, which show that a risk represents a greater exposure than would be expected from its nature e.g., the fact that a part of the building is being used for storage of inflammable materials. External factors that make the risk greater than normal e.g. the building is located next to a warehouse storing explosive material. Facts, which would make the amount of loss greater than that normally expected e.g. there is no segregation of hazardous goods from non-hazardous goods in the storage facility. History of Insurance (a) Details of previous losses and claims (b) if any other Insurance Company has earlier declined to insure the property and the special condition imposed by the other insurers; if any. The existence of other insurances. Full facts relating to the description of the subject matter of Insurance. Facts, Which Need Not Be Disclosed Facts of Law: Ignorance of law is not excusable - everyone is deemed to know the law. Overloading of goods carrying vehicles is legally banned. The transporter cannot take shelter behind the excuse that he was not aware of this provision; in the event of an accident. Facts which lessen or diminishes the Risk: The existence of a good firefighting system in the building. Facts of Common Knowledge: The insurer is expected to know the areas of strife and areas susceptible to riots and of the process followed in a particular trade or industry. Any fact which is known or which, by law, may be presumed to be known to the insurer, insurer is presumed to know matters of common notoriety or knowledge, and matters which an insurer, in the ordinary course of his business, ought to know. Facts which could be reasonably discovered, e.g. the previous history of claims which the Insurer is supposed to have in his record. Facts which the insurer's representative fails to notice: In burglary and fire insurance it is often the practice of insurance companies to depute surveyors to inspect the premises and in case the surveyor fails to notice hazardous features and provided the details are not withheld by the insured or concealed by him them the insured cannot be unless inquiry is made, it is not necessary to disclose the following facts: Any fact which it is superfluous to disclose by reason of an express or implied condition. Any fact as to which information is waived by the insurer. Any fact as to which insurer is given sufficient information to put him on inquiry. Effect of Non-Disclosure: Where there has been non-disclosure, whether innocent or fraudulent, sometimes called concealment the contract is voidable at the option of the insurer. This is the position where the matter is not dealt with by a policy condition. The ground is usually covered by a policy condition which may do no more than state the common law rule.