What is the consequence of a material misrepresentation, if intentional?

When a material misrepresentation is made intentionally, it is considered fraud. In the context of insurance, a material misrepresentation is a false statement that significantly impacts an insurer's decision to issue a policy or the terms under which it is provided. When such misrepresentation is intentional, it indicates a deliberate attempt to deceive the insurance company.

The consequence of this can lead to severe penalties, including potential fraud charges. These charges stem from the violation of trust and legal obligations that govern the insurance contract. Insurance companies rely on the accuracy of the information provided by applicants to assess risk accurately and set premium rates. When this trust is betrayed intentionally, the legal ramifications can be substantial, including criminal charges in some instances.

Although other outcomes like policy cancellation or adjustments in premiums and coverage limits may also occur due to misrepresentations, the direct legal consequence tied to intentional misrepresentation revolves around the notion of fraud and the potential for criminal prosecution, making the implication of fraud charges particularly significant in this context.