[PaulDavisThe1st]

You seem to be forgetting that this avoidance can work at two times:

1. pre-emptively dropping or refusing coverage

2. claim inspectors concluding the company has no liability for a particular incident.

It doesn't all need to be #2 (and probably should not be), but it also doesn't all need to be #1 either.

[hattmall]

#2 is less successful and incurs more costs. Trampolines are a good one because let's say you lie about a trampoline. Ok, great, we don't have to cover any trampoline related injuries. What are the chances that you would then lie and say that a broken arm occured on the steps instead and simply fail to mention the trampoline like you already did.

[tptacek]

You, the rogue trampoline owner, aren't really the party that the insurer is worried about. Your kid's best friend's parents are. (And it's not a broken arm they're really freaked out about --- don't make a homeowners claim over a broken arm, probably; it'll cost you more in the medium term --- it's death or paralysis, both of which will put millions of dollars on the line).