The Commercial Court in London has recently upheld an underwriter’s avoidance of an insurance policy covering a multi-million Euro Super Yacht M/Y GALATEA (“the Yacht”). The Court found that, before taking out the insurance policy, Involnert Management Inc’s (“the Insured”) representatives failed to disclose to the underwriter that:
(i) they had obtained a market valuation for the Yacht suggesting a value of around half the insured sum and
(ii) the Yacht was being marketed for sale at an asking price of 8 million Euros.
These two findings were held to be material non-disclosures by or on behalf of the Insured, entitling the underwriter to avoid the policy and thereby defeat the Insured’s claim.This placed the producing (“AIS”) and placing brokers (“OAMPS”) in the firing line.