If an agent suspects misrepresentation by an applicant, what is the agent's responsibility?

When an agent suspects misrepresentation by an applicant, the primary responsibility is to inform the insurance company. This is crucial because insurance companies rely on the accuracy and honesty of the information provided by applicants to assess risk, determine coverage, and set premiums. Misrepresentation can lead to significant consequences for both the insurer and the insured, including denial of claims or cancellation of the policy.

By notifying the insurance company, the agent ensures that the underwriting process is aware of potential discrepancies, allowing for a more thorough evaluation of the application. This step aligns with the agent's duty to act in the best interest of both the insurer and the insured, safeguarding the integrity of the underwriting process and ultimately ensuring that coverage is issued based on truthful information.

Other choices, such as notifying the applicant or consulting another agent, do not address the need to bring the issue to the insurance company's attention, which is a more immediate and relevant concern in the context of underwriting and risk assessment.