Warranty in Insurance
A statement or promise that becomes part of an insurance contract and is expected to be strictly true or performed as stated.
What does Warranty in Insurance mean in insurance?
Historically, breach of a warranty could affect coverage even when the breached statement was not directly related to a loss. Modern state laws may limit that result, so licensing exams commonly contrast a warranty with a representation, which is true to the applicant's best knowledge and belief.
Exam-ready definition
A contract statement or promise guaranteed to be true, as contrasted with a representation made to the best of one's knowledge.
Example
A commercial insured may warrant that a required protective system will remain operational.
Common misconception
In insurance terminology, a warranty is not the same as a consumer product repair guarantee.
Sample insurance exam question
Which is held to a stricter standard in traditional insurance contract law: a warranty or a representation?
Show answer
A warranty.
Related insurance terms
Don't just memorize terms.
Master the exam.
Get access to 650+ exam-like questions, detailed explanations, and specific state law-supplements for your state.
Which of the following best describes the concept of Warranty in Insurance?