The policyholder must disclose to the insurer all material risk circumstances of which he is aware before concluding the insurance contract.
A circumstance which the insurer has expressly asked about in writing is deemed to be material in case of doubt. However, the policyholder must also inform the insurer after the conclusion of the insurance contract if circumstances have arisen that make the insured event more likely. This may be the case with a building fire insurance policy, for example, if tenants install a photovoltaic system with a battery storage unit and the landlord has become aware of this.
A breach of the duty of disclosure entitles the insurer to refuse cover if the increased risk was the cause of the damage (7 Ob 253/24m). Irrespective of the occurrence of a loss, the insurer may cancel the insurance contract within one month of becoming aware of the risk-increasing circumstances (§ 27 of the Insurance Contract Act).