Reduction of the company's liability under a change of ownership insurance
Supreme Court judgment 28 October 2021, HR-2021-2102-A, (case no. 21-055691SIV-HRET), civil case, appeal against judgment.
A, The Norwegian Consumer Council (intervener) (Counsel Erlend Haaskjold) v. AmTrust Europe Limited (Counsel Joachim Dahl Wogstad Skjelsbæk)
Justices: Indreberg, Matheson, Kallerud, Arntzen, Thyness
The seller of a residential property had taken out a change of ownership insurance – currently referred to as a home sellers insurance – without stating in the self-declaration form to the insurance company that an annex had been built on the property without a permit. The insurance company, which agreed with the buyers to pay an amount to bring the annex to the required standard, submitted a claim for recourse to the seller. The Supreme Court's majority of four justices found, like the previous instances, that there was a basis for reduced liability on the insurer under section 4-2, cf. section 4-1 of the Insurance Contracts Act when the policyholder had given incorrect or incomplete answers to the questions in the self-declaration form. The fact that the insurer had not used the information in an individual risk assessment could not be decisive. The seller had intentionally given incorrect details, and was strongly to be blamed for holding back relevant information. Consequently, the insurer was without liability towards the policyholder. One justice arrived at the same conclusion based on section 4-9 of the Insurance Contracts Act.