warranty

"1. A statement to the insurer by an insured upon which the validity of the policy depends. The insurance contract is not binding unless the warranty statement is literally true. This is called an affirmative warranty. Traditionally, warranties appear either expressly or by reference on the face of the policy, and noncompliance is a complete defense for the insurer because a warranty is presumed to be material (of such substance or importance that the insurer relied upon it). On the other hand, representations may appear in documents collateral to or supporting the policy or may be oral; they are required to be substantially true but not absolutely so; and they must be proved to be material to relieve the insurer of its policy obligations. The strict rules of warranty have been modified in many states. Some statutes require that an insurance applicant's statements be deemed representations rather than warranties; or a court may interpret a description of insured property as a general identification rather than a warranty, so the insurer may not deny a claim only because the property did not continue to meet the description in every detail. 2. A promise by an insured as to a future event or condition during the policy term, such as maintaining fire sprinklers or burglar alarms in working order. This is called a promissory warranty. 3. A statement by the manufacturer or seller that a product is free of defects and will perform the functions for which it is sold. A product warranty includes a promise to repair or replace it or to refund the purchase price if a defect is discovered under normal conditions of use. In this sense, a warranty is a promise of indemnity against defects, while insurance is a promise of indemnity against loss or damage from perils unrelated to the product itself.
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