What can an intermediary be guilty of if they omit information on an application without the applicant's knowledge?

When an intermediary omits information on an application without the applicant's knowledge, they are committing misrepresentation. Misrepresentation occurs when someone provides false information or fails to provide key information that is significantly relevant to the situation, leading to a misunderstanding or a false impression regarding the facts of the application.

In this context, the intermediary's action of omitting information creates a potentially misleading scenario for the insurer, as the complete and accurate details are vital for proper risk assessment and decision-making. The intermediary's failure to disclose necessary information not only impacts the integrity of the application but also can lead to the denial of coverage or claims down the line, affecting the applicant negatively.

While negligence involves a failure to act with the level of care that a reasonable person would, and fraud typically implies intentional deception for personal gain, the key element in this case is the omission of crucial details without the applicant's knowledge, which directly aligns with the definition of misrepresentation. Thus, misrepresentation captures the essence of the intermediary's wrongful omission in this scenario.