What term describes the act of not disclosing known facts in an insurance context?

The term that describes the act of not disclosing known facts in an insurance context is concealment. In the insurance industry, concealment refers to the intentional withholding of information that is material to the risk being insured. This can occur when an applicant for insurance does not share relevant information that could influence the insurer's decision to provide coverage or the terms of that coverage.

Concealment is particularly significant because it directly affects the insurer's ability to assess risk accurately. If an insurer discovers that a policyholder concealed important facts after a claim is made, it can lead to denial of the claim or even the cancellation of the policy.

Other related terms, such as misrepresentation and fraud, refer to slightly different actions. Misrepresentation involves providing false information about the insured risk, while fraud generally encompasses a broader range of deceptive practices for personal gain. Omission, while it implies leaving out information, is not specific to the context of insurance and may not convey the intent behind the action as effectively as concealment does.

Understanding the nuances of these terms is essential for both insurance professionals and consumers to ensure transparency and fairness in the insurance process.