What distinguishes warranties from representations in an insurance application?

Warranties are distinct from representations in an insurance application primarily because warranties are statements that are guaranteed to be accurate, whereas representations are assertions made by the applicant that they believe to be true. Once a warranty is included in an insurance policy, it creates an obligation that the insured must uphold. If a warranty is found to be untrue or not fulfilled, it can lead to the insurer having the right to void the policy.

On the other hand, representations refer to the applicant’s honest belief about the facts at the time of making the application. These statements are not necessarily guaranteed to be correct; they are evaluated based on whether they were made in good faith. In the context of an insurance application, truthful representations generally protect the applicant, unless the insurer can demonstrate that a misrepresentation was material to the acceptance of the risk.

The other choices do not accurately reflect the fundamental differences between warranties and representations. The distinction is important as it directly impacts the obligations and protections of both the insured and the insurer in an insurance contract.