Netherlands Supreme Court confirms legal requirements to invoke non-disclosure
On 27 February 2026, the Netherlands’ Supreme Court issued a judgment that confirms the legal requirements to successfully invoke the consequences of a breach of the pre-contractual duty to disclose. The Supreme Court's decision concerns work-related disability insurance. In short, the Supreme Court holds that the moment of discovery of non-disclosure occurs, in principle, when the insurer has assessed the medical advice with sufficient dispatch. The two-month notice period begins to run from this moment of discovery of the pre-contractual non-disclosure. The Supreme Court further confirms, in line with the text of article 7:929 (1) Dutch Civil Code (DCC), that notifying the policyholder of the “possible consequences” of the non-disclosure is sufficient for a valid non-disclosure notice. This high court judgment overturned a previous decision by the Court of Appeal. (See CMS’s previous article on the Court of Appeal decision leading up to this Supreme Court ruling)
The question remains how this ruling relates to other types of insurance policies where insurers regularly appoint agents to assist in the claim-handling process (e.g. loss adjusters, experts and lawyers).
In any case, insurers and their agents should be alert to the moment they obtain sufficient certainty that a policyholder has breached a pre-contractual duty to disclose. Any indications of such a breach should be investigated because late notification of a non-disclosure to the policyholder leads to the impossibility of invoking the consequences of that non-disclosure.
Legal framework
According to Dutch insurance law, a policyholder is obliged to disclose information that is deemed relevant for the insurer in the decision-making process of insuring a certain risk. The policyholder that fails to do so may be, depending on the specific circumstances, in breach of the pre-contractual duty to disclose (in other words commit non-disclosure). This follows from article 7:928 DCC.
The insurer that wishes to invoke the consequences of non-disclosure should notify the policyholder within two months after discovery of the non-disclosure accompanied with a statement defining the consequences of the breach. The insurer that fails to send a timely notice loses the right to invoke the consequences of the non-disclosure. This follows from article 7:929 (1) DCC.
The law does not define what is meant by “discovery”. The moment of discovery is often subject to legal debate, especially given the grave consequences of a proven non-disclosure, which can include reduced insurance payment, higher premiums or a full denial of coverage. The Supreme Court provided guidance on the moment of discovery in a landmark case in 2023. (See CMS’s previous article on the 2023 Supreme Court ruling)
In that case, the Supreme Court ruled that the two-month period commences once the insurer has obtained a sufficient degree of certainty that the policyholder has failed to comply with the duty to disclose and that it depends on the specific circumstances of each case when the insurer obtained the necessary certainty, and whether and to what extent it can be expected that the insurer will conduct investigations that it received indications the policyholder was in breach of the duty to disclose. Unfortunately, the guidance did not provide the desired legal certainty as shown by the matter at hand.
Facts of the case
The underlying facts that led to the 27 February Supreme Court judgment can be summarised as follows:
The policyholder took out a work-related disability policy in 2014. The policyholder omitted to disclose a congenital spinal deformity.
In August 2020, the policyholder claimed under the policy because he was unable to work due to neck and back (i.e. spinal) problems. In a follow up to the notification, the insurer sent a letter to the policyholder on 5 November 2020 stating that the preliminary conclusion was that the policyholder had certain health problems that were not disclosed during the pre-contractual underwriting process. In the same letter, the insurer stated that this omission could affect policy coverage and announced further research into the medical situation of the policyholder.
On 19 February 2021, the insurer's medical advisor received a letter from a surgeon, which detailed a one-off consultation that the surgeon had with the policyholder on 15 June 2012 (i.e. before conclusion of the policy). The surgeon also stated he was aware of multiple consultations with other surgeons regarding the policyholder's chronic back pain due to a congenital spinal deformity.
The medical advisor stated that he read the letter of the surgeon on 1 March 2021, and informed the insurer on 9 March 2021. On 25 March 2021, the insurer sent an e-mail to the policyholder pointing out the discrepancies between the information received during the underwriting process and the medical information obtained. The insurer invoked non-disclosure and set out the possible legal consequences. To complete the insurers' investigations into the actual consequences of the non-disclosure, the insurer requested that the policyholder answer additional questions. The policyholder responded to those questions on 20 April 2021. On 29 April 2021, the insurer sent a letter to the policyholder concluding that there is no policy cover due to the non-disclosure.
Court of Appeal judgment
The Court of Appeal ruled that the moment of discovery of the non-disclosure was 19 February 2021 (i.e. the date that the medical advisor received the letter from the surgeon regarding the policyholder). The letter of 29 April 2021 was issued after the two-month period for announcing discovery, and hence was too late. The Court of Appeal did not attach legal consequences to the e-mail of 25 March 2021.
Supreme Court judgment
Take away 1: The Supreme Court confirms that the test as provided for in the 2023 judgment is applicable to the current matter. The Supreme Court further considers that, in relation to the moment of discovery of the non-disclosure, as a rule of principle, the receipt of the information by the medical advisor cannot be regarded as the moment of discovery of the non-disclosure by the insurer in the meaning of art. 7:929 DCC. One of the reasons for this conclusion is the professional privilege that applies to medical advisors advising insurers on claims under a work-related disability insurance policy.
Regarding this, the Supreme Court considered, as a general point of principle, that in the context of work-related disability insurance the insurer was only in the position to assess the potential breach of the pre-contractual duty to disclose after receipt of the advice of the medical advisor. Due to the insurers' prohibition to assess medical information, the Supreme Court considered that the starting point of the two-month period (i.e. the moment of discovery) is the moment that the insurer's claims handler has assessed the advice of the medical advisor with sufficient dispatch. The Supreme Court did not provide further guidance on what is meant by sufficient dispatch, which leaves room for discussion and will likely trigger legal debate in other cases within the context of claims under work-related disability insurance policies.
Taking the above into account, the Supreme Court concluded that the Court of Appeal was incorrect when it assumed that the surgeon's letter received by the medical advisor on 19 February 2021 qualified as the insurer’s moment of discovery of the breach. Therefore, the conclusion of the Court of Appeal that the 29 April 2021 letter was too late vis-à-vis the two-month notice period was also incorrect.
Take away 2: The Supreme Court confirmed, in line with the text of article 7:929 (1) DCC, that notifying the policyholder of the “possible consequences” of the breach was sufficient. The Supreme Court concluded that the Court of Appeal judgment was incomprehensible given the Court of Appeal had established that the insurer had informed the policyholder of the breach and the possible consequences by e-mail on 25 March 2021. That e-mail was sent within two months of 19 February 2021 even if that had been the moment of discovery.
Considerations for the legal practice following the Supreme Court judgment
In our opinion, the Supreme Court correctly decided that the knowledge of the medical advisor cannot automatically be attributed to the insurer when assessing the moment of discovery of a breach, especially in light of the professional privilege of the medical advisor and the specific context of work-related disability insurance policies.
The question remains how this ruling relates to other types of insurance policies where insurers regularly appoint agents to assist in the claim-handling process (e.g. loss adjusters, experts and lawyers).
In any case, insurers and their agents should be alert to the moment they obtain sufficient certainty that a policyholder has breached a pre-contractual duty to disclose. Any indications of such a breach should be investigated because late notification of a non-disclosure to the policyholder leads to the impossibility of invoking the consequences of that non-disclosure.
Apart from that, for the sake of legal certainty, it can be considered positive that the Supreme Court confirmed that an insurer needs to notify the policyholder of the possible consequences of an established breach of the pre-contractual duty to disclose.
For more information on Dutch insurance law, contact your CMS client partner or the CMS experts who contributed to this article.
