What must an insurer prove if non-disclosure occurred innocently?

When non-disclosure occurs innocently, insurers must demonstrate that the terms of the contract would have been different had the information been disclosed. This concept ties into the principle of utmost good faith that underlies insurance contracts, which requires both parties to act honestly and not withhold information that could influence the other's decisions.

In the case of innocent non-disclosure, it is not about proving intent or deception; rather, the focus is on how the undisclosed information could have changed the risk assessment and thus the terms or conditions of the insurance policy. For example, if a policyholder failed to disclose a minor health condition that was not considered relevant, the insurer must show that knowing about this condition would have led to adjustments in coverage or premiums. This demonstrates the fundamental idea that the terms of the contract are contingent upon the accurate representation of risk.