Insurance 101 – Chapter 5 – Volume 1 – The Implied Covenant of Good Faith and Fair Dealing

The Implied Covenant of Good Faith and Fair Dealing

The principle mantra in the insurance world is “Conduct business in the utmost good faith (uberrima fides).” The first reported decision acknowledging the need for utmost good faith in insurance was stated in the British House of Lords by Lord Mansfield in 1766. He made clear that the duty of good faith is not unilateral but rests upon both the insured and the insurer. This is still the law followed in England; it was adopted by United States appellate courts that recognize the covenant of good faith. The duty to deal with one another in good faith in all insurance transactions exists during every moment of the insurance transaction, from the negotiation for the contract, throughout its term, to its conclusion.

The following video was adapted from my book, “Insurance Claims A Comprehensive Guide” Published by the National Underwriter Company and is available at the Zalma Insurance Claims Library

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The author and publisher disclaim any liability, loss, or risk incurred as a consequence, directly or indirectly, of the use and application of any of the contents of this blog. The information provided is not a substitute for the advice of a competent insurance, legal, or other professional. The Information provided at this site should not be relied on as legal advice. Legal advice cannot be given without full consideration of all relevant information relating to an individual situation.

 

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