Implied Warranty

What Does Implied Warranty Mean?

An implied warranty refers to an unspoken assurance that a product or service meets basic standards of utility or performance. In the context of insurance, it implies that the insurer will provide coverage to the insured as specified in the policy’s terms and conditions.

Insuranceopedia Explains Implied Warranty

The fundamental assumption in insurance is that if the insured has paid the premiums, the insurer will provide coverage as outlined in the policy. However, insurance policies often include complex payment and coverage structures, along with clauses and exclusions, which can be overlooked, misinterpreted, or misunderstood. Therefore, it is essential for all parties to exercise due care and diligence in insurance transactions. The insured should fully understand the terms of the policy, while the insurer must be clear about their liabilities.