At what point does the duty of disclosure first arise in relation to an insurance policy?

The duty of disclosure first arises at the beginning of negotiations in relation to an insurance policy. This is when both parties engage in discussions about terms, coverage, and risks, and it is essential for the prospective insured to disclose any material facts that could influence the insurer's decision-making process regarding the policy. During this phase, insurers typically seek information to assess risk accurately and determine appropriate premiums.

If the insured fails to disclose relevant information at this early stage, it can lead to issues later, including the insurer being able to void the policy if they find out about the undisclosed facts after the contract is formed. This foundational duty is part of the principle of good faith (uberrimae fidei) that governs insurance contracts, emphasizing honesty and transparency from the outset of negotiations to ensure that both parties can make informed decisions.

Other points in the process, such as making an offer, accepting an offer, or after policy inception, follow this initial duty but do not serve as the first point of responsibility for disclosure.