Completing the Application, Underwriting, Delivering Policies, Contract Law
If a provision in a life insurance policy remains genuinely ambiguous after a court applies ordinary rules of interpretation, and it supports two reasonable meanings, how is the ambiguity typically resolved?
Answer and explanation
Answer: D. Texas courts construe a genuinely ambiguous insurance term in favor of coverage for the insured. A disagreement alone does not create ambiguity; both readings must remain reasonable after interpretive rules are applied.Source: Texas Judiciary — RSUI Indemnity Co. v. Lynd Co. — Opinion page 6, ambiguity and construction favoring coverage
More completing the application, underwriting, delivering policies, contract law questions
- A health provider receives a valid HIPAA authorization directing disclosure of specified records to a life insurer for underwriting. How does HIPAA's minimum-necessary standard apply to that authorized disclosure?
- A legal-age Texas applicant buys insurance on her own life and names a charitable corporation as beneficiary in writing on the application. Which statement is accurate?
- A life application authorizes the insurer to obtain information from a third-party provider but does not describe the information or provider type. What is missing?
- A life insurance policyowner may stop paying premiums at any time without legal penalty, but the insurer is legally bound to pay the death benefit if the insured dies while the policy is in force. This situation best illustrates which legal characteristic of an insurance contract?
- A parent applies for life insurance on a 9-year-old child. Who must sign the application besides the producer?
- A policy is arranged at inception solely so an unrelated investor can wager on the insured's death. Which required element of a legal contract is most directly missing or violated?
590 Texas questions like this one.
Every answer explained, the ones you miss come back on a spaced schedule, and a plan built from your exam date.