On The Application And Limitation Of The Unreliable Clause Of Insurance Law

Incontestable Clause was born based on nonequivalence of information and unbalance of right-obligation relation between the two parties of insurance contract. It protects the reliance interest and expectable interest of the applicant, the insured and the beneficiary through weakening the applicant’s disclosure obligation and restricting the insurer’s right of cancellation to balance the two parties’right and obligation and maintain normal business order. However, with the development of the insurance industry and the popularization of social insurance awareness, the types of insurance business are becoming richer and the public participation in insurance are continuously increasing. Incontestable Clause often becomes the protection of the applicant’s abuse of rights, which causes unbalanced relation between the two parties of insurance contract again. To solve the problem, it is necessary to reconstruct the right-obligation relation between the two parties and form an inter-constraint and interactive mechanism. Therefore, necessary restrictions should be made on Incontestable Clause. Regulate the exceptional cases of Incontestable Clause to prevent the applicant’s abuse of rights.This paper is divided into three chapters. Chapter one is mainly the basic theory of Incontestable Clause. This chapter starts from the definition of Incontestable Clause analyzing the differences and relations between Incontestable Clause and some relevant concepts, such as waiver and estoppels, etc., then briefly combs the historical revolution of Incontestable Clause. At the same time, this paper states the legal foundation and system value of the establishment and existence of Incontestable Clause.Chapter two analyzes the applicable regulations of Incontestable Clause mainly from three parts:applicable insurance type, conditions and time. In each part, this paper makes corresponding analysis of the applicable conditions that restrict Incontestable Clause combined with the conditions and problems of the Insurance Law of China. Whether the Incontestable Clause should be restricted under the condition of insurance coverage dispute and the unestablished insurance contract and the effect of notice time of loss on Incontestable Clause are mainly discussed.The main content of Chapter three is the restrict of the right of rescission on the application of Incontestable Clause. Through combing the relation between "the right of rescission in the Contract Law" and "the right of cancellation in the Insurance Law" and analyzing the dispute between "the theory of choosing" and "the theory of excluding", this paper comes to the conclusion of supporting "the theory of choosing". Under the condition that the applicant did not perform disclosure obligation and constituted fraud, the insurer has the right to exercise the right of rescission. At the same time, this paper demonstrates the feasibility of the restrict of the right of cancellation on the application of Incontestable Clause from the aspect of the inner requirements of the self-perfection of Incontestable Clause, the objective requirement of the sustained and stable development of the insurance industry and the inevitable requirement of the law to safeguard the integrity and judicial justice; then this paper puts forward suggestions for the construction of the insurer’s right of rescission regulations on this basis. The insurer’s right of rescission regulations should apply on the premise of severe fraud and restrict the duration of 5 years.