Shicara owns a jewelry store. In exchange for a discount on her burglary insurance premium, she promises the insurer that her trained guard dog will be on the premises at all times, even when the store is closed. One evening she takes the dog home with her instead of leaving him at the store, and a burglar breaks in and steals everything. The insurance company finds out the dog wasn't in the store when the burglary happened, and denies the claim. WHY does the insurer do this?

Question

Quizplus · Accepted Answer

Shicara breached a warranty by promising that her trained guard dog would be on the premises at all times, even when the store is closed, and then failing to follow through on that promise by taking the dog home with her. Breaching a warranty in an insurance policy can result in denial of a claim, even if the breach had nothing to do with the actual loss.

Shicara Owns a Jewelry Store