What must an insurer demonstrate to avoid a claim on a consumer insurance policy?

To successfully avoid a claim on a consumer insurance policy, an insurer must provide evidence of fraud or a breach related to the claim. This means that if the insurer demonstrates that the policyholder engaged in fraudulent behavior or failed to comply with essential policy conditions – such as making inaccurate statements or withholding information – the insurer may be justified in denying the claim. This principle protects insurers from having to pay claims that are based on dishonest actions of the insured.

In many insurance contracts, the duty of utmost good faith (uberrimae fidei) requires that both parties act honestly and disclose all relevant information. If an insurer can prove that the policyholder violated this duty through deceitful actions or material misrepresentation that is directly connected to the claim, they are typically entitled to deny the claim based on that evidence. This reflects the legal principle that insurance contracts rely heavily on trust and transparent communication between the insurer and the insured.