Superquote Terms: Utmost Good Faith

All insurance contracts / policies are based upon a principle of utmost good faith on both parties, the insured and the insurer. 

The principle is that both parties must tell the other about material facts which are appropriate and relevent to the contract that is being proposed.  The insurer is able to decline settling a claim if an insured has not disclosed facts and acted in the utmost good faith.

As an example, if John insures a campervan and knows he is about to be convicted of drink driving but does not inform his insurer, the company may deem he has not acted in upmost good faith and may nullify the policy.

Utmost good faith works both ways though and it is also a responsibility of the provider to ensure full facts of the policy are disclosed.  Essentially it means fair play.