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Agreement on Polygraph Test - Interpretation in Favour of Insurers or Insureds?
In C.C. 2059/99 Eliahu Insurance Co. Ltd. v. Avi Attias (Haifa Magistrates Court) PM39 (3), p.509 , the insurance company filed a motion to dismiss the insured's claim against it, based on the results of a polygraph test, which the insured had agreed to undergo, which indicated that he was not being truthful. Although the Court did not accept the motion, several important principles were set out:
First, that an agreement between the parties, including an agreement to undergo a polygraph test, is valid and obliges both parties.
Second, that the insurance company's duty to disclose and explain the conditions and significance of the polygraph agreement, is limited.
The insurer has a duty to explain to the insured the terms of the agreement - in particular that the insurance claim will be declined if the polygraph test results in indications of lies. However, as long as the insurer can prove that it has fulfilled the above condition, the insured will not be able to contend that he did not understand the nature and essence of the document he signed. The presumption is that the contract was signed willingly, between two eligible parties, hence it is binding.
Third, the Court declined the allegation that polygraph agreement is a prejudicing agreement, thus not valid. The insured had two alternatives: either to sign the agreement and receive prompt indemnification if found to be truthful, or to file a claim in Court. These are reasonable and acceptable alternatives.
In spite of the above, the motion for dismissal was declined, since the Court ruled that the insurance company did not provide sufficient proof that the specific polygraph institution which performed the test, was an institution the parties had agreed upon in advance as conditioned in the agreement.
The judgement is of significance mainly because the Court interpreted the agreement between the insured and the insurer on the basis of its business and logical objective, and in favour of the insurance company, as opposed to the rules of interpretation used in many other previous judgements.
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