Life Ch. 3 Legal Concepts
A statement made on an application that is deliberately false is called a felony concealment misrepresentation warranty
A false statement intentionally made on an application is considered a misrepresentation.
Making a statement on an insurance application that only reveals part of the truth is called defamation concealment coercion misrepresentation
Concealment is defined as the failure by the applicant to disclose a known material fact when applying for insurance.
In order for a misrepresentation or concealment on an application to void a Life insurance policy, it has to be material intentional material and intentional none of these
For a misrepresentation or concealment on an application to void a Life insurance policy, it must be both intentional and material.
Kathy applies for a preferred rate on an insurance application. The insurance company responds by classifying her as a standard risk. The insurer's response is best characterized as a(n) solicitation offer counteroffer decline
In this situation, the insurance company's response is best characterized as a counteroffer.
At what point is insurable interest required for life insurance? at policy approval at the time of death at the time of application at policy delivery
Insurable interest is required at the time of the application.
What constitutes the insurance company's consideration in an insurance policy? Buyer's guide Conditional receipt Policy summary Promises contained in the policy
The promises contained in a policy are considered the insurance company's consideration.
How is consideration characterized in contract law? Intent Reasonable expectations Offer and acceptance Something of value
Consideration is regarded as something of value in contract law.
The legal term that applies to a contract where one party may receive more benefits than the other is called speculative aleatory adhesion conditional
Insurance contracts are aleatory. This means there is an element of chance and potential for unequal exchange of value for both parties.
An application submitted to an insurer that includes the initial premium is considered a(n) solicitation consideration offer accepted offer
An application submitted to an insurer that includes the initial premium is considered an offer. The insurance company accepts the offer when it issues the policy as applied for.
The only party in an insurance contract that makes a legally enforceable promise is the insurance company. Because of this, insurance contracts are considered to be what kind of contracts? conditional aleatory unilateral contracts of adhesion
Insurance contracts are unilateral. This means that only one party (the insurer) makes any kind of enforceable promise.
An insurance company is required to provide coverage so long as the policyowner is current on the premium payments. This characteristic makes the contract aleatory unilateral optional conditional
An insurance contract is conditional. This means that the insurer's promise to pay benefits depend on the occurrence of an event covered by the contract. For example, the timely payment of premiums is a condition for keeping the contract in force. If premiums are not paid, the company is relieved of its obligation to pay a death benefit.
When an application for insurance is taken, the statements made by the applicant are true and accurate to the best of the applicant's knowledge. These statements are considered to be adhesion representations guaranties warranties
Statements on an application are legally referred to as representations.