A person applying for insurance intentionally misrepresents material facts in order to obtain an insurance policy. The insurer discovers the deceit ten months later after the policy has been issued. What action will the insurer take?

Cancel coverage

Explanation:

Remember, Insurance policy is also a contract of obligation. Therefore, when one party defaults the other party is free from his obligation.

Since it was ten months later into the insurance contract that this misrepresentation was discovered, the insurer can cancel converage.

Recission

Explanation:

The said contract with deciet can be voided and won't be legally binding as the supplied information are false. And in this light a recission action is been taken by the insurance company against the client before the law Court.