Insurance Applications: Representations
8 Questions
2 Views

Choose a study mode

Play Quiz
Study Flashcards
Spaced Repetition
Chat to lesson

Podcast

Play an AI-generated podcast conversation about this lesson

Questions and Answers

What is the definition of a representation in an insurance application?

  • Oral or written statements that are true to the best of the applicant's knowledge and belief (correct)
  • A guaranteed fact made by the insurer
  • A promise made by the applicant
  • A statement made after the policy is issued

    • When can a representation be changed or amended?

  • Never
  • Prior to the policy issue (correct)
  • Only after the policy is issued
  • Anytime during the policy term

    • What is a misrepresentation that does not affect underwriting?

  • A material misrepresentation
  • A misrepresentation that is not material (correct)
  • Any false statement
  • A fraudulent misrepresentation

    • What could be grounds for voiding an insurance contract upon discovery?

    <p>Material misrepresentation</p> Signup and view all the answers

    What defines concealment in an insurance application context?

    <p>Failure to voluntarily disclose material facts</p> Signup and view all the answers

    What represents intentional deception in an insurance application?

    <p>Fraud</p> Signup and view all the answers

    Who can rescind or cancel a contract if fraud is determined?

    <p>Both parties</p> Signup and view all the answers

    What is a warranty in the context of insurance applications?

    <p>A statement guaranteed to be true made by the insurer or its representative</p> Signup and view all the answers

    Study Notes

    Statements on Insurance Applications

    • Representations
      • Oral or written statements made by an applicant when completing an application for insurance
      • Must be true to the best of one's knowledge and belief
      • Made prior to policy issuance and can be changed or amended prior to policy issue, but not afterward
      • Materiality of the statement depends on whether it influences policy issue
      • Not considered warranties

    Misrepresentation

    - A false statement that does not affect underwriting
- Is not material and will not affect policy issue
- Examples: mailing address error

    Material Misrepresentation

    - A false statement or concealment important to policy issuance
- Typically includes: health statements, driving record, drug/alcohol abuse, hazardous activities
- Severity determined by materiality
- Considered false when facts fail to correspond with assertions or stipulations
- Can be grounds for voiding the contract upon discovery

    Concealment

    - Failure to voluntarily disclose material facts relevant to underwriting
- Failure to communicate that which a party knows and ought to communicate
- Regardless of intent, may be grounds for rescission by either party

    Fraud

    - Intentional deception
- Often associated with filing a false claim
- If determined to be fraudulent, either party may rescind or cancel the contract

    Studying That Suits You

    Use AI to generate personalized quizzes and flashcards to suit your learning preferences.

    Quiz Team

    Description

    Understand the importance of representations in insurance applications, including oral and written statements made by applicants. Learn about materiality, amendments, and policy issuance.

    More Like This

    Use Quizgecko on...
    Browser
    Open
    Browser
    Browser