Which term refers to a policy condition that guarantees a fact, possibly based on information in the insured's application?

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Prepare for the Florida Claims Adjuster (6-20) Test. Use flashcards and multiple choice questions, with hints and explanations for each question. Ace your exam!

Multiple Choice

Which term refers to a policy condition that guarantees a fact, possibly based on information in the insured's application?

Explanation:
A warranty is a policy condition that guarantees certain facts are true, often based on information in the insured’s application. Warranties are strict promises; if a guaranteed fact turns out not to be true, the insurer can deny coverage or void the policy, even if the breach didn’t affect the claim. This is different from representations, which are statements believed true to the best of the applicant’s knowledge and aren’t guaranteed. Concealment involves intentionally withholding information, and abandonment is relinquishing property; neither fits the idea of a guaranteed fact within a policy.

A warranty is a policy condition that guarantees certain facts are true, often based on information in the insured’s application. Warranties are strict promises; if a guaranteed fact turns out not to be true, the insurer can deny coverage or void the policy, even if the breach didn’t affect the claim. This is different from representations, which are statements believed true to the best of the applicant’s knowledge and aren’t guaranteed. Concealment involves intentionally withholding information, and abandonment is relinquishing property; neither fits the idea of a guaranteed fact within a policy.

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