Contract Law

The violation of a material warranty or other material provision of a policy allows

Both the insurer and the insured to rescind

What is a material misrepresentation?

Concealment

Every expressed warranty made at or before the execution of a policy must be

Contained in and referred to in the policy or other document and signed by the insured.

What is an injured party entitled to receive if an intentional concealment is discovered?

Rescission of the policy

The act of revoking or terminating an insurance policy is called

cancellation

A contract between an insured and an insurance company which agrees to pay the insured for loss caused by specific events is

A policy

In insurance, an offer is usually made when

An applicant submits an application to the insurer

Representations are written or oral statements made by the applicant which

Are considered true to the best of the applicant's knowledge.

Which of the following is NOT a requirement element of an insurance contract?

Counteroffer

Which of the following best describes the policy non renewal?

Discontinuance of an insurance policy by the insured on the policy anniversary date.

An insurer neglects to pay a legitimate claim that is covered under the terms of the policy. Which of the following insurance principles has the insurer violated?

Good faith

The key factor of representation that allows the injured party to rescind the contract is

If the representation is false in a material point. (If a representation is false in a material point the injured party is entitled to rescind the contract from the time the representation becomes false.)

Which of the following does NOT need to be identified in an insurance policy?

Insurer's financial rating

In forming an insurance contract, when does acceptance usually occur?

When an insurer's underwriter approves coverage

Representations in insurance contracts qualify as

implied warranties