Registered Insurance Brokers of Ontario (RIBO) Exam 2026 – 400 Free Practice Questions to Pass the Exam

When an insurer voids a policy due to misrepresentation, they are typically required to refund the entire premium related to the misrepresented property. This obligation stems from the principle that the insurer would not have entered into the contract had they known the true facts. The contract is considered void from the beginning, which implies that the insured is entitled to a full refund for the premium paid since the policy is treated as if it never existed due to the misrepresentation.

In this context, the complete premium refund ensures fairness to the policyholder who was misled or provided inaccurate information. By receiving a full refund, the insured does not suffer a financial loss stemming from the policy that the insurer is no longer willing to uphold. This further highlights the importance of accurate representation when entering into an insurance contract, as misrepresentation can nullify expectancies tied to coverage.

Other options do not align with the standard practice or legal requirement regarding refunds in cases of policy voidance due to misrepresentation. Therefore, the necessity of a complete premium refund reflects the fair treatment of all parties involved.