Assured must disclose to the insurer before the contract is concluded, every material circumstance which is known to the assured and which would influence the insurer’s judgement in fixing the premium or whether or not he would accept the risk.
e.g. shipowner must disclose that his ship has failed for example a special survey.
Insurer is not liable for any loss which is not proximately caused by a peril insured against.
E.g. if a ship is scuttled and seawater entering the ship sinks her, owner may claim that the peril of seas was the cause of his loss, but the insurer would not be liable since scuttling is a wilful misconduct of the assured.