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On August 9, Albert made an application for life insurance that his agent submitted | ||
a day later without a premium payment. On August 21, the insurer issued the |  | |
policy as applied for and on August 24, the agent delivered the policy and collected | ||
the initial premium. On what day was the contract offer made? |  | |
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August 9ÂÂ
August 10ÂÂ
August 21ÂÂ
August 24 - ANSWER- C. Rationale:If an applicant does not submit an initial premium with the application, the applicant is inviting the insurance company to make a contract offer. The insurer can respond by issuing a policy (the offer) that the applicant can accept by paying the premium when the policy is delivered.ÂÂ
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All statements made by an applicant in an application for life insurance are | |
considered to be |  |
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warrantiesÂÂ
affirmationsÂÂ
representationsÂÂ
declarations - ANSWER- C. Rationale:Most states require that life insurance policies contain a provision that all statements made in application be deemed representation not warranties. A representation is a statement made by the applicant that the applicant believes to be true. A warranty is a statement made by the applicant that is to be true. If an insurance company rejects a claim on the basis of a representation, the company bears the burden of proving materiality.ÂÂ
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Which of the following legal terms indicates that a life insurance contract contains | |
the enforceable promises of only one party? |  |
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adhesionÂÂ
unilateralÂÂ
conditional
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