What are the implications of concealment of information by the insured and by the insurer?

It may turn out from the representations furnished by the customer that the details are incomplete or any important information is concealed or is misleading. In such circumstances it is the choice of the insurer whether to: Incorporate the required changes in the contract and charge a different premium. Accept the policy and pay compensation especially if the facts have negligible importance. Avoid any obligation on its part as per the policy. It has to be proved by the insurer that the non-disclosure or misrepresentation was intentional on the part of the insured to commit fraud and deceive the insurer before it can stop payment of compensation. Non-disclosure may be unintentional on the part of the insured. Even so such a contract is rendered voidable at the insurer's option and it can refuse any compensation. Any concealment of material facts is considered intentional. In this case also the policy is considered void. It is true that in a contract of insurance the insured has to furnish more information about him. But there are certain covenants in a contract, which have to be thoroughly elaborated to the insured. These relate to the conditions in which the insurance company may or may not perform its promises. It has to be noted that it is the duty of both the insurance agent and the company authorities that this particular aspect is looked into. Any laxity at this point may tilt the judgments in favour of the insured in case of a dispute.