The Court of Milan, in its Judgement n. 4959/2015, published on 20 April 2015, R.G. n. 46086/2010, ruled that the misrepresentations of the assured on the security measures in place at inception of the policy, as represented under the proposal form, entail a gross negligence of the jeweller pursuant to art. 1892 of the Italian Civil Code (“codice civile”) and accordingly the insurer is not bound to pay the sum insured under the policy.
Article 1892 of the Italian Civil Code (“codice civile”) – named Misrepresentations or fraudulent or grossly negligent failure in disclose – provides that “If the contracting party, fraudulently or through gross negligence, misrepresents or fails to disclose circumstances which, if known to the insurer, would have caused him to withhold his consent to the contract, or to withhold his consent on the same conditions, the insurer can annul the contract. The insurer is entitled to the premiums covering the period of insurance running at the time when he petitioned for annulment of the contract, and in all cases to the premiums agreed upon for the first year. If the loss occurs before the expiration of the period indicated in the preceding paragraph, the insurer is not bound to pay the sum insured.“
The Court further ruled that the fact that the security measures were not in place also at the time of the loss entails autonomously a loss caused by gross negligence of the assured pursuant to art. 1900 of the Italian Civil Code (“codice civile”) – named Loss caused by fraud or gross negligence of the Insured – which provides that “The insurer is not liable for losses caused by the fraud or gross negligence of the contracting party, of the insured, or of the beneficiary, unless there is an agreement to the contrary for cases of gross negligence.”