Chapter 2: Legal Concepts
Insurance policies are offered on a take it or leave it basic which make them
Contracts of adhesion
which of these is not considered an element of an insurance contract
negotiating
what is the consideration given by an insurer in the consideration clause of a life policy
promise to pay a death benefit to a named beneficiary
statements made on an insurance application that are believed to be true to the best of the applicants knowledge are called
representations
Warranty
statements guaranteed to be true
all of the following are considered to be typical characteristics describing the nature of an insurance contract except
bilateral
A policy of adhesion can be modified by whom
the insurance company
which of these is considered to be a statement that is assured to be true in every aspect
warranty
at what point does an informal contract become binding
when one party makes an offer and the other party accepts that offer
When must insurable interest be present in order for a life insurance policy to be valid?
when the application Is made
E & F are business partners. each takes out a 500,000 life insurance policy on the other naming himself as the primary beneficiary. e & f eventually terminate their business. 4 months later e dies. the primary beneficiary was still f. Where will the proceeds from es life insurance policy be directed to
F
STOLI has been found to be in violation of which of the following contactual elements
legal purposes or insurable interest
insurance policies are considered aleatory because
performance is conditioned upon a future occurence
which of theses is not a type of agent authority
principal
a policy of adhesion can only be modified by whom
the insurance company
the consideration clause of an insurance contract includes
the schedule and amount of premium payments
in an insurance contract, the insurer is the only party who makes a legally enforceable promise- what kind of contract is this
unilateral
life and health insurance policies are
unilateral contracts
q purchases 500,000 insurance policy and pays 900$ in premiums over the 6 months. q dies suddenly and the beneficiary is paid 500,000. the exchange of unequal values reflects which of the following insurance contract features
Aleatory
a life insurance arrangement that circumvents insurable interest statutes is called
IOLI
which of these arrangements allows one to bypass insurable interest laws
IOLI- investor Originate life insurancw
a contract where one party either accepts or rejects the terms of a contract written by another party is Called a contract of..
adhesion
Insurance Contracts are known as _______ because certain future conditions or acts must occur before any claims can be paid
conditional
which of these require an offer acceptance and consideration
contract
Taking receipt of premiums and holding them for insurance company is an example of
fiduciary responsibility
in regards to representations or warranties which of these statements is true
if material to the risk, false representations WILL VOID A POLICY
When must insurable interest exist for life insurance contract to be valid
inception of contract
a life insurance policy would be considered a wagering contract without
insurable interest
When third-party ownership is involved, applicants who also happen to be the stated primary beneficiary are required to have
insurable interest in the proposed insured
who makes the legally enforceable promises in a uniltal insurance policy
insurance company
if a contract of adhesion contains complicated language to whom would the interpretation be in favor of
insured
