Question

Which course of action is the insurer entitled to when deliberate concealment is committed by the insured?

a) Cancel the policy with immediate effect
b) Increase the policy premium
c) Reduce the policy benefits
d) None of the above

Answer 1

When deliberate concealment is committed by the insured, the insurer is entitled to cancel the policy with immediate effect.

Step-by-step explanation:

When deliberate concealment is committed by the insured, the insurer is entitled to cancel the policy with immediate effect. This means that the insurance coverage will be terminated, and the insured will no longer be protected under the policy. The insurer may exercise this course of action in order to protect their interests and prevent fraudulent behavior by the insured.

Example: If a person deliberately conceals a pre-existing medical condition when applying for health insurance, the insurer can cancel the policy once they discover the deception.