Supreme Court rules that a "collateral lie" is immaterial to an insurance claim

In Versloot Dredging BV and another v HDI Gerling Industrie Versicherung AG and Others [2016] UKSC 45, the Supreme Court held that policyholders who advance otherwise valid insurance claims by lies which are irrelevant to their rights to recover do not forfeit their claims under the policy: "the lie is dishonest but the claim is not".

In doing so, the Supreme Court overruled the decision of the Court of Appeal ([2015] QB 608), and rejected the analysis of the law by Mance LJ (as he then was) in Agapitos v Agnew (The Aegeon) [2003] QB 556 (on which the Court of Appeal decision had been based) that an insured who supports a valid claim with a lie forfeits his claim. For more on the decision, see our insurance and reinsurance disputes team's e-bulletin on the decision.