A legal product, particularly a Constitutional Court decision, guarantees justice and certainty for all parties seeking justice. Wisdom in capturing legal problems and providing the best solution is an elegant step, representing the quality of scientific reasoning and the wisdom of people instructed under a mandate, especially for legal decisions laden with complexity. For academics, criticizing a legal product, especially in scientific forums or publications, serves as a means to advance their work. The dynamic, actual, and prospective development of legal science always reaches into the future. An academic study to analyze and critique the Constitutional Court Decision from an academic-scientific perspective is urgent and crucial, considering that the decision has the potential to cause legal problems in its implementation, despite being final and binding. Observing the substantive core of the verdict, judges declared the following statement: “2. the norms of Article 251 of the Commercial Code (Staatsblad 1847 Number 23) are contrary to the 1945 Constitution of the Republic of Indonesia and have no binding legal force conditionally to the extent that they are not interpreted as “including those relating to the cancellation of coverage must be based on the agreement of the insurer and the insured or based on a court decision.” Every new legal product, especially the decision of the Constitutional.
The meaning and applicability of Article 251 of the KUHD from the perspective of contract law
Insurance agreements are basically inseparable from the arrangement of agreements in general, as stipulated in Book III of the BW, although they are in accordance with the provisions of Book III of the BW. The specificity of the insurance agreement is also more specifically regulated in the KUHD. Article 1313 of the BW provides a formulation of “contract or agreement”: “An agreement is an act by which one or more persons bind themselves to one or more other persons.” The causal-functional relationship between contracts gives birth to obligations, where obligatory agreements (which create obligations) are the main means for parties to independently regulate the legal relations between them. The meaning of “agreement” as a legal act gives birth to “engagement” as a legal relationship in the field of property between two people (or more), where one party (debtor) is obliged to perform what is written in a contract, while the other party (creditor) is entitled to that performed contract.” This has consequences for the validity and binding force of the agreement on the parties (legal consequences – liability).
Article 251 of the KUHD as the Basis of Agreement in Insurance Agreement
This study emphasizes the crucial point of the emergence of an insurance agreement, its legal consequences for the parties, and the consequences of a defect of will. An insurance agreement has unique characteristics when compared to other types of agreements. One of these specificities is stipulated in Article 251 of the KUHD: “Any false or untrue notice, or any concealment of circumstances known to the insured, even if made in good faith, of such a nature that the contract would not have been entered into, or would not have been entered into on the same terms, had the insurer known the true state of affairs, this situation renders the insurance void.” The ratio legis of Article 251 of the KUHD is inseparable from the consideration of protection for the insurer, enabling it to provide compensation to the insured in the event of an unexpected occurrence, which becomes the object/interest in the insurance agreement.
The Meaning of Utmost Good Faith in Article 251 of the KUHD Associated with the Pre-Contractual Phase
When referring to the formulation of Article 251 of the KUHD, which is framed by other articles within the framework of a contract law system (see Articles 1320, 1338 (3), and 1339 of the BW), the insurance agreement must also take into account other legal signs. In other words, the parties in making an insurance agreement need to pay attention to the following matters (Hernoko 2021): – The parties must fulfill the conditions for the validity of the agreement; – To achieve the parties’ objectives, the agreement must have a cause; – The agreement does not contain a false or prohibited cause; – The agreement must not violate propriety, custom, decency, and public order; – The agreement must be performed in good faith. The Utmost Good Faith in the formulation of Article 251 of the KUHD is explicitly addressed and related to the Pre-Contractual Phase, in which the formation of an agreement (offer >< acceptance) must be based on the good faith of the parties, i.e., with the emphasis on the insured. As explained earlier, the insured has an obligation to disclose matters related to themselves, their conditions, or interests that form the basis of the agreement honestly and accurately. The insured is the one who knows best about everything related to themselves, their condition, or their interests. On the basis of honest and true information from the insured, the principle of indemnity arises to anticipate the risk of loss of interest suffered by the insured. The assessment of the amount of indemnity is highly dependent on honest and accurate information, ensuring that the principle of balance and proportionality between the premium paid by the insured and the indemnity cover provided by the insurer is maintained.
Penulis : Agus Yudha Hernoko
Agus Yudha Hernoko, Fitri Nur Amalia, Pamungkas Ridaningjati, Kinan Kalam Khalifa, Antonino Pedro Marçal’ The Urgency of Amending Article 251 of the KUHD Related to The Principle of the Utmost Good Faith in Insurance Agreement (Critical Note on the Decision of the Constitutional Court Case Number 83/PUU-XXII/2024)” https://journal.unesa.ac.id/index.php/suarahukum/article/view/42610
https://doi.org/10.26740/jsh.v7n2.p540-564
Vol. 7 No. 2 (2025): Jurnal Suara Hukum
