Which statement about Statutory Conditions is incorrect?

The statement that the insurer rarely charges additional premium for reported material changes is the incorrect one because statutory conditions often imply that when there are material changes to the risk that is insured, the insurer may adjust the terms of the policy, including the premium. Insurers typically reevaluate the risk exposure when they are informed about significant changes in circumstances (e.g., changes in property condition, use, or occupancy) that materially affect the underwriting. Therefore, a change that increases the level of risk may very well lead to an increase in the premium, or even different coverage terms, if appropriate notification is given.

In contrast, the other statements accurately reflect the principles surrounding statutory conditions in insurance. Misrepresentations can indeed void policies if they are significant enough to affect the insurer’s decision to underwrite the policy. Insured individuals are required to report changes promptly as part of their duty of utmost good faith, known as “uberrima fides,” ensuring that the insurer has accurate and current information upon which to base its coverage decisions. Failure to report such changes can lead to claims being denied because the insurer might argue that they were not given a fair chance to assess the risk properly.