There has long been a principal of upmost good faith in Marine Insurance, i.e. you have to disclose information that is relevant, even if you are not asked for it and this recent case form Puerto Rico really emphasizes that
A Catlin is a Lloyd’s syndicate and the Federal Court ruled they were justified in rescinding policy coverage for a sunken dry dock because its policyholder had not provided it with a complete and accurate information about its value and condition, a federal court ruled.
San Juan Towing & Marine Services Inc. (Puerto Rico) purchased a dry dock, the Perseverance, for $1.05 million in 2006. In February 2010, it advertised the dry dock for sale for $1.35 million. In September 2011, it sold it for $700,000 to Leevac Shipyards (Louisiana) The dry dock sank the end of that month, according to the court records.
Catlin insured the dry dock for $1.75 million in April 2011. The Underwriters was never informed of its much lower $700,000 sale price, according to the ruling.