State RegulationsGA specificDifficulty 2/5
How are an applicant's statements in a Georgia life insurance application classified, and what effect does a misstatement have on recovery under O.C.G.A. § 33-24-7?
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Answer & full 3-part explanation (select an option above, or peek)
Why C is correct
Under O.C.G.A. § 33-24-7, statements in an insurance application are representations, not warranties; the applicant need only answer in good faith. A misrepresentation defeats recovery only if it increases the risk of loss or contributes toward the loss. This consumer-friendly classification means immaterial or harmless inaccuracies do not void coverage, in contrast to the harsh common-law warranty rule where any breach voided the contract.
Why the other options are wrong
- A) Application statements are representations, not warranties, so minor inaccuracies do not automatically defeat recovery.
- B) The classification is representation, and intent is not the test; the effect turns on whether the misstatement increases the risk of loss.
- D) A risk-increasing misrepresentation can bar recovery, so misstatements are not always harmless.
Memory hook
Georgia applications: representations, not warranties — only risk-raising lies hurt.