Fraudulent Misrepresentation

Published: | Updated: September 2, 2017

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Definition - What does Fraudulent Misrepresentation mean?

Fraudulent misrepresentation is a type of misrepresentation wherein a person makes a statement knowing that it is false, with the intention to deceive another person. In terms of insurance, fraudulent misrepresentation can lead to voiding of a contract.

Insuranceopedia explains Fraudulent Misrepresentation

In proving fraudulent misrepresentation, five elements must concur. First, there should be material misrepresentation. In other words, there must be a false statement of a fact material to the contractual agreement. Second, there must be a reckless disregard to the truth of the statement. Third, there must be an intent on the part of the person to induce the other to enter into the contract believing that the statement is true. Fourth, the false statement of fact must have been the reason for the entering into the contract. Fifth, the false statement must have caused injury or damage to the other party.

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