Marine Insurance is contract uberrimae fidei :

A contract of marine insurance, like any other contract, is a contract based upon the utmost good faith, and if the utmost good faith is not observed by either party, the contract may be avoided by the other party. Therefore the assured must disclose to the insurer, before the contract is concluded, every material circumstance which is known to the assured and the assured is deemed to know every circumstance which, in the ordinary course of business, ought to be known to him.

If the assured fails to make such disclosure, the insurer may avoid the contract.

A circumstance is material if it could influence the judgment of a prudent insurer in fixing the premium, or determining whether or not he will take the risk.

“No obligation to disclose”

In the absence of inquiry from the insurer, the following circumstances need not be disclosed, by the insured, namely:-

(a) any circumstance which diminishes the risk;

(b) any circumstance which is known or presumed to be known to the insurer. The insurer is presumed to know matters of common notoriety or knowledge, and matters which an insurer in the ordinary course of his business as such, ought to know;

(c) any circumstance as to which information is waived by the insurer;

d) any circumstance which it is superfluous to disclose by reason of any express or implied warranty.

Subject to the above, the Insurance Agent is also obliged to disclose to the insurer the circumstances which are within his knowledge and circumstances which he ought to know.