What will an insurance company do if a prospective insured conceals a pre-existing condition and later submits a claim?

In the context of insurance, if a prospective insured conceals a pre-existing condition and later submits a claim for that condition, the insurance company typically has the right to take action based on the material misrepresentation. While the selected answer suggests that the company would continue coverage but exclude the specific condition, this does not accurately reflect standard industry practices regarding concealment of material facts.

Normally, insurance policies include clauses that specify how pre-existing conditions are treated, and if a condition was intentionally concealed, the insurer can pursue options such as voiding the policy or limiting benefits. Often, insurers will investigate claims related to concealed information and may deny the claim altogether if they determine that there was intentional fraud or misrepresentation.

In such cases, the most common approach would be to void the policy, as the insurer relies on accurate disclosures to assess the risk involved in insuring the individual. Therefore, when dealing with concealed conditions, the insurance company's standard response is to maintain the integrity of the insurance process by not providing benefits that are based on undisclosed risks.