What can cause a change in the insurer's liability in case of misrepresentation by the proposer?

The insurer's liability can be significantly impacted by a change in the risk details provided during the application process. Misrepresentation occurs when the proposer provides false or misleading information regarding the risk they want to insure. If the details about the risk change—such as new information related to the nature of the risk or its circumstances—this may indeed alter how the insurer assesses the risk and their subsequent liability.

For instance, if a proposer initially provides one set of risk details but later discloses that the situation has changed (like additional hazards becoming apparent or modifications in the operations being insured), the insurer may consider this new information essential for determining the coverage and pricing of the policy. Such changes can lead to adjustments in the insurer's liability, including the possibility of refusing to cover claims related to the newly disclosed aspects of risk.

This facet of insurance is crucial since it underscores the importance of accurate and transparent communication between the proposer and the insurer during the underwriting process. If the details of the risk are not reflective of the actual circumstances at the time of embodiment in insurance contracts, it can lead to significant implications, both for coverage and claims handling.