It’s worse than that actually; say the liar’s house burns down and the insurance adjuster finds the trampoline in the garden after the fact. As I understand it, the insurer can void the entire contract.
It isn’t always fraud or lying - you apply for insurance. Insurer asks you a million questions. One is “do you have a trampoline”? You honestly answer “No”. The fine print of the application form says you have to tell them if at any time your answers change. After a while, you forget it even asked you about a trampoline. Then, you get your kid a trampoline. Per insurance fine print, you are suppose to inform the insurer of this change in circumstances immediately, but you’ve forgotten that.
Also, it depends on the jurisdiction, but while the insurer can try to void the whole contract, courts don’t always let them do it, especially if the policyholder convinces the court it was an innocent mistake or oversight rather than a deliberate lie.
This is not a good example of "fine print", because trampolines are notorious sources of injury. It's like if you added a pool to your property and didn't tell your insurer because you "forgot the fine print". You can plead that, but if I was your neighbor, I'd be rooting for the insurer. Knowing about the dangers of things you set up on your property is on you.
We used to have a trampoline. We never once told our insurer about it. When I first applied for the insurance (at the same time we bought the house), I have no memory of being asked if we had one (we didn't at the time). I don't remember ever seeing that question from them, although I can't be completely certain it wasn't on some piece of paper and I didn't notice it. If they never ask, I'm under no obligation to tell them.
Look, I hear you, but at some point this has to be on you. The CPSC has a thing dedicated to trampolines. The Mayo Clinic has articles about it. It is a huge cause of injuries of minors around the country. I'll grant that this is slightly more obscure an issue than swimming pools, but there are tons of swimming pool buyers who would make similar claims ("nobody told me swimming pools were that risky, this is just fine print mumbo jumbo"), and I don't think anyone here would entertain those.
Well, I'm not in America, and I'm wondering if this is an American thing?
I just checked my insurance policy. The word "trampoline" never once occurs in it. I don't think my insurer cares about trampolines.
If I think about it: given the absurdly large payouts for some injury lawsuits in the US, I understand why American insurers might be particularly sensitive to things that might induce injury, like trampolines. Given Australian courts tend to be much more modest in the damages they award, I can see why Australian insurers might not see them as something worth paying any special attention to.
Also, even in the US: it might seem obvious to someone who grew up there, but for an immigrant from a country with a different insurance system, it wouldn’t be obvious
To explain the lawsuit issue, here is a perfectly plausible scenario and how it could play out somewhere in the USA.:
1. A person is at a friend's house for dinner
2. Upon leaving to go home, they trip and fall trying to navigate an unlit path to their car
3. Their injury lands them in the hospital and requires a week or so of recovery time in which they could not work, and as they contract out they lose that money
4. The health insurance that fully covered their injury, looks at the medical records and finds that the injury occurred on another property and calls the people involved and finds out about the unlit path
5. They deny payment for the medical treatments and tell the injured person to sue the friend for medical payment because they are at fault and they have home owner's insurance
6. Forced to sue the friend or be out tens of thousands of dollars, the injured person adds to the claim for lost wages (hey, the friend isn't paying for it anyway, the insurance is)
This is how you end up with such lawsuits that the USA is famous for -- people are forced to sue other people in order to not go bankrupt, and things get piled on that.
I just bought homeowners, it didn't ask anything about trampolines. Am I expected to call them up and inform about one? They specifically ask about a pool and if it is fenced or not.
There were some neighbors down the street from my parents that put a trampoline right next to several decorative boulders. These weren't small - same height as the trampoline (at least 4 feet) and very jagged. Thankfully it disappeared again within a couple of days but my god can people be STUPID.
Our economy runs on contracts. If one is able to avoid the terms of the contract by claiming one didn't read it, the whole system falls apart.
(When I bought a house, the sales contract was maybe 50 pages. I went to the escrow company to sign. The escrow agent was visibly annoyed that I leaned back in the chair and set about reading every page. One of the pages that needed to be signed said nothing but "I have read and understood this contract.")
> If one is able to avoid the terms of the contract by claiming one didn't read it, the whole system falls apart.
Except, Courts have ruled that you can, at least sometimes, get out of the fine print of a contract by claiming you didn't read it. For example, see the notable 1962 Supreme Court of California case, Steven v. Fidelity Casualty Co [0].
In 1957, plaintiff purchased a life insurance policy covering plane crashes, from a vending machine in Los Angeles, with his wife as the beneficiary. His itinerary took him from LA to Chicago, and from there to Dayton, Ohio. On his return from Dayton to Chicago, he'd scheduled a one night stopover in Terre Haute, Indiana. In the morning, he went to the airport in Terre Haute, and was distressed to discover the flight had been cancelled due to technical issues, and he was going to miss his connection in Chicago. The airline agent referred him to a charter airline, who organised a charter flight for him and a handful of other passengers back to Chicago. Sadly, the charter flight crashed, and he died.
His widow sought to claim on the life insurance policy. The insurer denied the claim, on the grounds that the fine print of the policy said that it only applied to scheduled air carriers, not charter flights, and hence the flight on which the insured died was excluded. His widow sued the insurance company in the name of her deceased husband. The trial court sided with the insurer, on the grounds that this clause was clearly stated in the fine print of the policy, which the policyholder was expected to have read, and he had signed to say that he had.
However, on appeal, the Supreme Court of California overturned the judgement, and ruled for the widow. It held that, for consumer insurance contracts, any clause or exclusion which the policyholder could not have reasonably expected, must be pointed out prominently, not buried in the fine print. Since, it ruled, the policyholder had no particular reason to expect the exclusion of charter flights, and the insurer had not prominently stated that exclusion in the policy (e.g. by using a larger font), it was not legally binding.
And, from what I understand, the rule established in this 1962 case is followed in California law to this day, and has also been adopted by the courts of several other US states
That makes sense in a vacuum, but in the real world not everyone is a lawyer and corporations have a vast power imbalance compared with a member of the general public. It's incredibly easy to bury something surprising among many other clauses, such as only scheduled flights being covered and not charters. The idea certain potentially surprising clauses need to more prominent seems pretty reasonable on balance. The onus is still on the signing party to read them, but they are afforded the opportunity to notice among many clauses these are ones that deserve special attention.
That means there will always be an argument around what a reasonable party would consider a surprising clause, but contract law disputes deal with nuance, edge cases, and what a reasonable party would expect all the time. With rulings like this corporations will air on the side of caution when taking big swings in forming their agreements since litigation is so costly and the outcome so uncertain. Consumers gain a little power back (though still far from equal footing).
This should only apply when there are large power imbalances, such as individual people entering agreements with vast multinational corporations. When big corps ink deals with each other caveat emptor should reign; they have equal opportunity to review and understand the terms and therefore have to live with the consequences.
> The onus is still on the signing party to read them, but they are afforded the opportunity to notice among many clauses these are ones that deserve special attention.
It's not unreasonable to expect a party to a contract to read all of it. If one's case is based on "I didn't read it", the other party should prevail.
> Consumers gain a little power back (though still far from equal footing).
The consumer can always say "no". An important feature of a free market is there are no forced contracts. Saying "no" is the ultimate power.
Why are parts of the contract allowed to be in different size typeface in the first place? There should only be headings and body text, no other sizes.
I mean, the insurer in that case discovered that the client was defrauding them. If you steal $100 from someone's cash register, buy scratchy lotteries with it, win $200, and put the $100 back in the register, you're still a thief. That's the logic here: you gambled on a pirate trampoline and feel like you should have won.
I don't know if it really is the case that your insurance can be voided over material misrepresentations unrelated to your claim, but certainly there's no moral argument that it shouldn't work that way.
Also, it depends on the jurisdiction, but while the insurer can try to void the whole contract, courts don’t always let them do it, especially if the policyholder convinces the court it was an innocent mistake or oversight rather than a deliberate lie.