What can happen if a warranty is found to be false?

When a warranty is found to be false, it is significant because warranties serve as promises made by the insured regarding certain conditions or facts that are material to the risk being insured. A warranty is a crucial part of the insurance contract, as it assures the insurer that the information provided is accurate and that the conditions stated in the warranty will be complied with. If a warranty is breached or found to be false, it can give the insurer the right to void the contract.

Voiding the contract means that the insurance coverage is no longer in force from the inception of the policy, as though it never existed. This can have serious implications for the insured, as they may find themselves without coverage at a critical time. Therefore, the correct answer reflects the legal principle that a false warranty undermines the basis of the insurance contract, allowing the insurer to cancel it.