What are statements made by the applicant in an insurance application considered to be?

Statements made by the applicant in an insurance application are considered representations because they are assertions or statements regarding the applicant's facts, circumstances, and intentions to the best of their knowledge. These representations are typically viewed as being made in good faith and are essential for the insurer to assess risk.

In the context of insurance, a representation is not guaranteed to be true; rather, it reflects the applicant's belief or understanding at the time of application. This is important for insurers, as these statements help them decide whether to accept the risk and under what terms. Misrepresentations can lead to issues during claims, but as long as the statements are made honestly, they generally do not void the policy.

By contrast, warranties are promises that a specific condition will be true or fulfilled; if a warranty is found to be false, it can lead to the voiding of the policy. Declarations typically refer to a section in the insurance policy that provides key information, such as who is insured and the coverage limits. Contracts, on the other hand, are broader agreements that establish the terms and conditions of the insurance policy itself and require mutual consent and obligations from both the insurer and insured.