Life Insu 2-Legal concepts

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without ___ in the insured a life insurance contract is not enforceable ; for instance, ___ usually have this interest in the life of one another ; it must only exist at the ___of the appllication

insurable interest ; spouses ; time

what is a warranty?

is a statement guaranteed to be true

Applicant are presumed competent unless-

mentaly ill, under influence, or minor

people who buy life insurance are called ___rather than____ because they can transfer their ownership, which is called___

policy owners ; policy holders ; assignment

considered to be true and accurate to the best of the applicants' belief ; FAILURE by the applicant to disclose a known material fact when applying for insurance

representation ; concelament

Investor-originated life insurance (or IOLI), sometimes called _____-originated life insurance (or STOLI) is used to _____ state insurable interest statutes.

stranger; circumvent

Insurance contract are ___meaning only the insurer makes an enforceable ____

unilateral;promise

to be legally enforceable a contract must be made with a definite _____ proposal offer ; an offer answered by a counter offer is __

unqualified ; void

insurance applicants are required to make a full, fair, and honest disclosure of the risk to the agent

utmost good faith

life insurance contracts are ___contracts; pays a stated sum regardless of the amount loss

valued

The part of a life insurance policy guaranteed to be true is called a

warranty

A life insurance policy would be considered a wagering contract WITHOUT

insurable interest

insurance contracts are contracts of ___ meaning contract was prepared by the insurer "____" with no negotiation

ashesion ; as is

Insurance contracts are known as ____ because certain future conditions or acts must occur before any claims can be paid.

conditional

life insurance is ____meaning that the pay of benefits is dependent on an event covered by the contract

conditional

An insured that owns 50,000 in fire insurance suffers a 5000 loss so they only get 5,000-What type of Contract? ; examples of these types of contracts are_____&___insurance

indemnity ; health and fire

Q purchases a $500,000 life insurance policy and pays $900 in premiums over the first six months. Q dies suddenly and the beneficiary is paid $500,000. This exchange of unequal values reflects which of the following insurance contract features?

Aleatory

All of the following are considered to be typical characteristics describing the nature of an insurance contract, EXCEPT:

Bilateral

Life and health insurance policies are:

Bilateral contracts

Taking receipt of premiums and holding them for the insurance company is an example of

Fiduciary responsibility

Unilateral, aleatory, and adhesion are all special features of ____ contracts.

INSURANCE

In regards to representations or warranties, which of these statements is TRUE?

If material to the risk, false representations will void a policy

If a contract of adhesion contains complicated language, to whom would the interpretation be in favor of?

Insured

Which of these arrangements allows one to bypass insurable interest laws?

Investor-Originated Life Insurance

A life insurance arrangement which circumvents insurable interest statutes is called

Investor-Originated Life Insurance; .

Stranger Originated Life Insurance (STOLI) has been found to be in violation of which of the following contractual elements?

Legal Purpose (Insurable Interest)

life insurance where investors or strangers get individuals or seniors to take out a policy naming the investor as beneficiary ; they generally ___money to the insured

Stranger Originated life Ins. or Investor -Originated Life Ins; loan

A policy of adhesion can only be modified by whom?

The insurance company

At what point does an informal contract become binding?

When one party makes an offer and the other party accepts that offer


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