In an insurance application, what term describes a statement of fact or opinion made by the insured in response to a question from the insurer?

• A. Warranty
• B. Material Fact
• C. Policy Provision
• D. Representation

Answer: (D)

In an insurance application, the term for a statement of fact or opinion made by the insured in response to a question from the insurer is a representation. Representations are the insured’s answers used to help the insurer assess risk; they can be true or false, and if a representation is false and material to the risk, it can affect the policy if discovered later, including denial of a claim or cancellation.

This differs from warranties, which are absolute promises about conditions that must be true for the policy to be in effect; a breach can void coverage. It also differs from a material fact, which is an important fact relevant to underwriting, not the act of answering questions on the application. And a policy provision is a clause within the contract, not the statements made on the application.