North Carolina Adjuster Practice Exam

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Which of the following situations does not involve misrepresentation?

A customer exaggerates the value of their claim
An agent includes false information on an application
An agency promotes competition by publicly posting sales figures
A policyholder fails to disclose previous claims

The correct answer is: An agency promotes competition by publicly posting sales figures

The situation of an agency promoting competition by publicly posting sales figures does not involve misrepresentation because it is simply presenting factual sales data. When an agency shares its sales figures, it is providing information that can help consumers make informed decisions about which agency to choose. This practice is transparent and does not involve altering or fabricating information to deceive any party. In contrast, exaggerating the value of a claim, including false information on an application, and failing to disclose previous claims all involve intentional distortions of truth or omissions that can mislead others, typically for personal gain. Misrepresentation occurs when a party provides false or misleading information that could affect the decision-making of other parties, such as insurers or counterparties in a financial transaction.