Orlando Harmon
A warranty is a guarantee or promise that provides assurance by one party to another that specific facts or conditions are true or will happen. In the context of life insurance, a warranty is a promise by the insured party that statements affecting the validity of the contract are true. Warranties in insurance contracts can be divided into two types: affirmative or promissory. An affirmative warranty is a statement regarding a fact at the time the contract was made, whereas a promissory warranty is a statement about future facts or about facts that will continue to be true throughout the term of the policy.
| Characteristics | Values |
|---|---|
| Definition | A warranty is a guarantee or promise which provides assurance by one party to the other party that specific facts or conditions are true or will happen |
| Types | Affirmative or promissory |
| Affirmative warranty | A statement regarding a fact at the time the contract was made |
| Promissory warranty | A statement about future facts or about facts that will continue to be true throughout the term of the policy |
| Untrue warranties | An untruthful affirmative warranty makes an insurance contract void at its inception. If a promissory warranty becomes untrue, the insurer may cancel coverage |
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What You'll Learn
A warranty is a guarantee or promise
In an insurance policy, a warranty is a promise by the insured party that statements affecting the validity of the contract are true. Most insurance contracts require the insured to make certain warranties. For example, to obtain a health insurance policy, an insured party may have to warrant that they do not suffer from a terminal disease. Warranties in insurance contracts can be divided into two types: affirmative or promissory. An affirmative warranty is a statement regarding a fact at the time the contract was made. A promissory warranty is a statement about future facts or about facts that will continue to be true throughout the term of the policy. An untruthful affirmative warranty makes an insurance contract void at its inception. If a promissory warranty becomes untrue, the insurer may cancel coverage at such time. For example, if an insured party warrants that property to be covered by a fire insurance policy will never be used for the mixing of explosives, the insurer may cancel the policy if the insured party decides to start mixing explosives on the property.
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Warranties can be affirmative or promissory
Warranties are a guarantee or promise that provides assurance by one party to another that specific facts or conditions are true or will happen. In the context of life insurance, warranties are promises by the insured party that statements affecting the validity of the contract are true. For example, to obtain a health insurance policy, an insured party may have to warrant that they do not suffer from a terminal disease.
Warranties in insurance contracts can be divided into two types: affirmative or promissory. An affirmative warranty is a statement regarding a fact at the time the contract was made. A promissory warranty is a statement about future facts or about facts that will continue to be true throughout the term of the policy. An untruthful affirmative warranty makes an insurance contract void at its inception. If a promissory warranty becomes untrue, the insurer may cancel coverage at such time. For example, if an insured party warrants that property to be covered by a fire insurance policy will never be used for the mixing of explosives, the insurer may cancel the policy if the insured party decides to start mixing explosives on the property.
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Warranties in insurance contracts
In contract law, a warranty generally means a guarantee or promise which provides assurance by one party to the other party that specific facts or conditions are true or will happen. This factual guarantee may be enforced regardless of materiality, which allows for a legal remedy if that promise is not true or followed.
A warranty in an insurance policy is a promise by the insured party that statements affecting the validity of the contract are true. Most insurance contracts require the insured to make certain warranties. For example, to obtain a health insurance policy, an insured party may have to warrant that they do not suffer from a terminal disease.
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Warranties are a type of product insurance
Warranties in insurance contracts can be divided into two types: affirmative or promissory. An affirmative warranty is a statement regarding a fact at the time the contract was made. A promissory warranty is a statement about future facts or about facts that will continue to be true throughout the term of the policy. An untruthful affirmative warranty makes an insurance contract void at its inception. If a promissory warranty becomes untrue, the insurer may cancel coverage at such time. For example, if an insured party warrants that property to be covered by a fire insurance policy will never be used for the mixing of explosives, the insurer may cancel the policy if the insured party decides to start mixing explosives on the property.
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Warranties provide legal remedy if a promise is not true
A warranty in an insurance policy is a promise by the insured party that statements affecting the validity of the contract are true. Most insurance contracts require the insured to make certain warranties. For example, to obtain a health insurance policy, an insured party may have to warrant that they do not suffer from a terminal disease. Warranties in insurance contracts can be divided into two types: affirmative or promissory. An affirmative warranty is a statement regarding a fact at the time the contract was made. A promissory warranty is a statement about future facts or about facts that will continue to be true throughout the term of the policy. An untruthful affirmative warranty makes an insurance contract void at its inception. If a promissory warranty becomes true, the insurer may cancel coverage at such time as the warranty becomes untrue. For example, if an insured party warrants that property to be covered by a fire insurance policy will never be used for the mixing of explosives, the insurer may cancel the policy if the insured party decides to start mixing explosives on the property.
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Frequently asked questions
A warranty is a guarantee or promise which provides assurance by one party to the other party that specific facts or conditions are true or will happen. Warranties in insurance contracts can be divided into two types: affirmative or promissory. An affirmative warranty is a statement regarding a fact at the time the contract was made. A promissory warranty is a statement about future facts or about facts that will continue to be true throughout the term of the policy.
An example of an affirmative warranty is a statement made by an insured party that they do not suffer from a terminal disease when obtaining a Health Insurance policy.
An example of a promissory warranty is a statement made by an insured party that the property covered by a fire insurance policy will never be used for the mixing of explosives.
