Hawaii Insurance License Practice Exam 2025 – Complete Prep Guide

Misrepresentation refers to the act of making a statement that is untrue, particularly when it pertains to the details of an insurance policy or the risk associated with an insured person or property. In insurance, accuracy and honesty in the information provided to the insurer are crucial because they influence underwriting decisions and the terms of the insurance contract. If a statement made during the application process is found to be false or misleading, it can impact the validity of the policy and the claims process. Misrepresentation can lead to consequences such as denial of coverage or cancellation of the policy, as insurers rely on accurate information to assess risk accurately and to set appropriate premiums.

In contrast, truthful statements made under duress, correct assumptions about an insured's risk, or miscommunications regarding policy terms do not capture the essence of misrepresentation, which specifically involves untruths that challenge the integrity of the information provided to the insurer.