Will at&t phone insurance cover jailbroken iphones?

I just bought an IPhone 4s and i was thinking of jailbreaking it. I pay the monthly $10 for the phone insurance, will that be voided if I bring in if it was, lets say, water damaged and they found out it was jailbroken?

Added (1). I might also note that I was told this covered against stolen phones… Would i possibly be able to just say it was stolen?

Most likely so. You will void Apple's warranty for sure if you do so, so I wouldn't be surprised if it is the same case with AT&T's.