INSURANCE CONTRACTS ACT 1984 (AUSTRALIA)

8 Application of Act

• (1) Subject to section 9, the application of this Act extends to contracts of insurance and proposed contracts of insurance the proper law of which is or would be the law of a State or the law of a Territory in which this Act applies or to which this Act extends.
• (2) For the purposes of subsection (1), where the proper law of a contract or proposed contract would, but for an express provision to the contrary included or to be included in the contract or in some other contract, be the law of a State or of a Territory in which this Act applies or to which this Act extends, then, notwithstanding that provision, the proper law of the contract is the law of that State or Territory.

9 Exceptions to application of Act

• (1) Except as otherwise provided by this Act, this Act does not apply to or in relation to contracts and proposed contracts:
  • (a) of reinsurance; or
  • (b) of insurance entered into, or proposed to be entered into, by a private health insurer within the meaning of the Private Health Insurance Act 2007 in respect of its health insurance business within the meaning of Division 121 of that Act; or
  • (ba) of insurance entered into, or proposed to be entered into, by a private health insurer within the meaning of the Private Health Insurance Act 2007 in respect of its health related business within the meaning of section 131–15 of that Act that is conducted through a health benefits fund (as defined by section 131–10 of that Act); or
  • (c) of insurance entered into, or proposed to be entered into, by a friendly society; or
  • (ca) of insurance entered into, or proposed to be entered into, by the Export Finance and Insurance Corporation, other than short-term insurance contracts within the meaning of the Export Finance and Insurance Corporation Act 1991 that are entered into on or after the commencement of this paragraph; or
  • (d) to or in relation to which the Marine Insurance Act 1909 applies; or
  • (e) entered into or proposed to be entered into for the purposes of a law (including a law of a State or Territory) that relates to:
    • (i) workers’ compensation; or
    • (ii) compensation for the death of a person, or for injury to a person, arising out of the use of a motor vehicle.
• (2) This Act does not apply to or in relation to contracts and proposed contracts of insurance entered into, or proposed to be entered into, in the course of State insurance or Northern Territory insurance, including contracts and proposed contracts entered into, or proposed to be entered into, by:
  • (a) a State or the Northern Territory; and
  • (b) some other insurer;
    • as joint insurers.
• (3) Sections 37, 41, 58, 59, 60, 63, 69 and 74 do not apply in relation to contracts, and proposed contracts, of insurance against the risk of the loss of an aircraft, or damage to the hull of an aircraft, as a result of war.
• (4) Sections 53 and 63 do not apply in relation to a provision of a contract, or a proposed contract, of insurance to the extent that:
  • (a) the provision authorises or permits the insurer to vary or cancel either or both of the following:
    • (i) cover for risks related to war;
    • (ii) cover for risks related to terrorism; and
  • (b) the provision is prescribed or otherwise identified by the regulations.

9A Exclusion of pleasure craft from the Marine Insurance Act 1909

• (1) The Marine Insurance Act 1909 does not apply to a contract of marine insurance made in respect of a pleasure craft unless the contract is made in connection with the pleasure craft’s capacity as cargo.
• (2) For the purposes of this section, a pleasure craft is a ship that is:
  • (a) used or intended to be used:
    • (i) wholly for recreational activities, sporting activities, or both; and
    • (ii) otherwise than for reward; and
  • (b) legally and beneficially owned by one or more individuals; and
  • (c) not declared by the regulations to be exempt from this subsection.
• (3) For the purposes of paragraph (2)(a), any minor, infrequent and irregular use of a ship for activities other than:
  • (a) recreational activities; or
  • (b) sporting activities;
    • is to be ignored.
• (4) In this section:
  • contract of marine insurance has the same meaning as in the Marine Insurance Act 1909.

13 The duty of the utmost good faith

A contract of insurance is a contract based on the utmost good faith and there is implied in such a contract a provision requiring each party to it to act towards the other party, in respect of any matter arising under or in relation to it, with the utmost good faith.