Under what circumstances can an insurer deny a claim?

An insurer can deny a claim based on misrepresentation of health status or non-payment of premiums because these factors directly affect the validity of the insurance contract. When a policyholder applies for insurance, they provide information regarding their health status. If it is found that the policyholder intentionally provided false information or omitted crucial details during the application process, the insurer has the right to rescind the policy or deny claims. This is because the insurer relies on accurate information to assess risk and determine the appropriate premium. Similarly, if premiums are not paid, the insurance contract is considered void, and the insurer is not obligated to pay any claims, as coverage is contingent upon the policy being in force.

Other factors such as exceeding the policy coverage amount or engaging in risky hobbies may lead to partial payouts or adjustments in coverage but do not invalidate the entire claim like misrepresentation or non-payment do. Additionally, raising rates is a separate issue related to policy pricing and not directly related to the claims process.