In the Course of a Claims Investigation,the Insurer Discovers That

Multiple Choice

In the course of a claims investigation,the insurer discovers that the warehouse it covers has been used for dynamite storage for the last year. When the policy was first issued four years ago,the insurer agreed to cover it for clothing storage. What does the law typically allow the insurer to do in this situation?

A) Pay the claim in full.
B) Pay only a proportion of the claim
C) Deny the claim
D) Prosecute the insured for intentional misrepresentation