Final answer:
Both the representative and the insurer are typically responsible for false statements made by the representative when advertising the company's policies at a local convention, under principles of agency and vicarious liability.
Step-by-step explanation:
When an insurer hires a representative to advertise at a local convention, and the representative makes false statements about the insurance policies to secure more business, both the representative and the insurer can be held responsible for those representations. This scenario deals with concepts of agency and vicarious liability. The representative, as an agent of the insurer, has the power to affect the legal relations of the insurer. Therefore, the actions of the representative, especially if within the scope of their employment, could result in the insurer being held liable.
Specifically, if the representative was authorized to speak on behalf of the company, the insurer generally bears responsibility for the employee's actions, given that they occurred during the scope of employment. In many jurisdictions, this is known as respondeat superior, a legal doctrine which holds an employer liable for the actions of an employee when those actions take place within the scope of employment.
However, the representative could also be held personally liable for intentionally misrepresenting the policies, which is known as fraudulent misrepresentation. Ultimately, the responsibility might be shared between both parties, depending on the specific circumstances and whether the representative was acting within the scope of their duties as defined by their employment with the insurer.
For this reason, the correct answer would be C) Both the representative and the insurer.