On Utmost Good Faith Of Marine Insurance Law

Good faith is one of the basic principles of Civil Law. Parties in insurance contracts, whose acts in insurance practice are in fact a kind of civil juristic acts, are bound by this principle. Utmost good faith came into being as an outcome of the inborn characteristics in insurance practice and contracts.The term "Utmost good faith" doesn't appear in Chinese Law. Then, is utmost good faith, originating from ENGLISH MARINE INSURANCE ACT 1906, embodied in Chinese Law? Or is there any connection or difference? Is there anything relating to this principle in Chinese Law requiring perfecting? In this article, the author of this essay dealt with such questions as: concept and function of the basic principles of Civil Law; the origination and development of utmost good faith ; summery about utmost good faith; the comparison of utmost good faith in Chinese and English laws; the defect of this principle and suggestions on the improvement of it in Chinese law and so forth.By studying and referring to a large amount of Chinese and foreign books in this field and many cases in foreign countries, the author draws a conclusion that Utmost Good Faith is just Good Faith in essence ,and that it is an application and natural development of good faith in marine insurance law. It is applied before and after the contract is concluded. It forces the insured as well as the insurer to obey some severe obligations. We should keep an eye on the obligation for the insurers, because they actually usually have an obvious advantage over the insured in skilled staff and expertise while many believe that they are in an inferior situation. In addition, the limited regulations in law can never list any aspect in the complex world, thus, our understanding of utmost good faith should never be limited to the specific obligations regulated by law. Both parties in insurance contracts should consciously obey the principle of utmost good faith. Only by behaving this way, can we protect trade , equalize interests between the parties concerned and realize justice and fairness of law, to the largest extent. We can be bold enough to draw a conclusion that utmost good faith is just a thick thread that goes through the whole process of the practice in marine insurance.As for the improvement in the legislation of the Chinese law in the future, if possible, the author holds that the regulation of the term "Utmost Good Faith" should be added to Section 1 of Chapter XII ( Contract of Marine Insurance) in MARITIME CODE OF THE PEOPLE'S REPUBLIC OF CHINA. Of course, mere abstract principle is far from enough, which should be transformed into specific and clear rights and obligations for both parties of the contracts. Also the author hope our country will adopt the merits about utmost good faith in ENGLISH MARINE INSURANCE ACT 1906, making it more reasonable in Chinese law and better directing the juristic acts of the parties . Also the legislative department should perfect the laws and regulations in relation to marine insurance and enhance the authority of administration in insurance practice.