False Pretenses

What Does False Pretenses Mean?

False pretenses refer to the criminal act of obtaining property through deceptive means.

Losses arising from this crime are often excluded from insurance policies. However, the insured may request that this peril be included in their insurance contract.

Insuranceopedia Explains False Pretenses

When someone lies or misrepresents a fact to persuade another person to relinquish property or valuables, such as jewelry, they are committing the crime of false pretenses. For example, if someone pretends to be a relative of a deceased person to acquire something from the family estate, they are acquiring property under false pretenses.

Losses resulting from this crime can be recovered if it is specifically included in the insurance contract. Certain garage insurance policies, for instance, include false pretenses as part of the insured risks. This is because automotive dealers who use a garage to buy or sell used vehicles are vulnerable to purchasing or selling items of questionable ownership, which may be validated by forged or fraudulent documents. Given the serious business risk this presents, such dealers are likely to seek policies that cover this peril.