Warranties and Representations

A policy contract being based upon the answers to the questions contained in the application, it follows that material misstatements by the applicant should place him in the moral position of one who secures a thing of value through misrepresentation and false pretense. In many instances, however, the tendency of court decisions has been in the direction of protecting the insured by giving him the benefit of the doubt wherever possible and by placing favorable constructions upon the "materiality" of inquiries contained in the application. For this reason many life-insurance policies contain, and according to the views of many authorities should contain, a "warranty clause" in which the truth of his statements is warranted by the applicant. Thus some life policies call attention, not merely once but several times, and usually in special print, to the fact that answers in the application are made a part of the contract and shall have the effect of warranties. By this practice the companies aim to give added force to the information furnished in the application with a view to protecting themselves as fully as possible against fraud and against the difficulty of proving the materiality of inquiries to the satisfaction of a jury. Such references are also "common in the policies of many other types of insurance, and in probably no business is the emphasis on warranties so frequent as in insurance. Thus, the standard fire policy provides that "if an application, survey, plan, or description of property be referred to in this policy it shall be a part, of this contract and a warranty by the insured." The marine-insurance contract also furnishes a striking illustration of numerous provisions and endorsements which are declared in the contract to be warranties.