This study is aimed at analyzing the legal effect of breach of warranty in construction insurance contracts in Malaysia in light of the current developments in The English insurance law. The required data and information were collected from Malaysian and English court decisions dealing with breach of warranties in English marine insurance law from the online Malayan Law Journal published on the LexisNexis online database and from published textbooks related to insurance warranties. This study would help to offer judicial guidance to courts in Peninsular Malaysia on how to resolve the legal dilemma associated with breach of warranty in Malaysian insurance law. It was found out that the effect of breach of a continuing warranty will result in the contract of insurance remaining in existence and the risk is being treated as having incepted at the outset but automatically coming to an end as of the date of the breach. More so, the insurer is being discharged from any future liability, although any liabilities of the insurer before the date of the breach are unaffected. © Maxwell Scientific Organization, 2011.