Coyote, for a start I am in no way or never had implied that this case is one of fraud (I’m sure you will tell if I am wrong).

Fraud is "intent to deceive and desire to induce the firm to pay more than it otherwise would". Misrepresentation and non-disclosure falls into the utmost good faith category. They may be obtaining a service by deception (at best) but certainly not fraud as there is no monetary value involved for a payout!

So, you are telling me that if a policyholder insures a vehicle as being a standard model but then when a claim arises that vehicle turns out to be heavily modified and they claim the higher value, that they are not trying to obtain a monetary advantage?

Sometimes insurers will pay a claim but will not offer to renew a policy, again where fraud is suspected but not proven. This is a valid contractual right that insurers have but an option that needs to be weighed against the knowledge that it will be very difficult, if not impossible, for the customer to obtain insurance cover again.

Very True, but this taken as a last resort when fraud cannot be proven.

(1) non-disclosure of a fact material to the risk which the policyholder could not reasonably be expected to have disclosed; or

(2) non-negligent misrepresentation of a fact material to the risk; or

Again, true but in these cases the ND/MR is minimal and would not normally take my option 2. We would look to settle on 3 or 4.

I've had time to re-read plenty of the comments from start to finish. I'm not unclear at all... are you?

I understand both sides of the argument fully, the one thing I am unsure on is as to whether you are an insurance professional or a disgruntled policyholder - no offence intended but they are clearly two different standings.