Principles of utmost good faith is only applicable to life insurance contract.

Ans. No, this statement is false. This is because of the following reasons,

Principle of Utmost Good Faith (Uberrimae Fidei): -All types of insurance contracts require utmost good faith towards each other. The insurer and the insured must also disclose all material facts, clearly, correctly and completely. If the insurer finds that certain material facts relating to the contract was not disclosed the insurer may avoid the contract, this principle is more important for Life Insurance as the information disclosed will affect the decision of the Insurance Company to decide whether to accept or reject the proposal.