What term describes the withholding of facts that should be included in an insurance application?

Concealment is the term used to describe the withholding of facts that are relevant and should be disclosed in an insurance application. This act typically involves the intentional failure to disclose material information that could affect the insurer's decision to provide coverage or the terms of that coverage. In the context of insurance, concealing information can lead to disputes or issues in the claim process, as the insurer may have relied on the information provided when assessing risk and determining premium rates.

In an insurance application, certain facts such as pre-existing conditions, previous claims, or other pertinent details are crucial for the insurer to evaluate risk accurately. If an applicant knowingly withholds these facts, it can create grounds for the insurer to deny a claim or even void the policy altogether. Understanding this concept is essential for both consumers and insurance professionals, as it emphasizes the importance of transparency and honesty in the application process.