General Insurance
Which policy feature is designed chiefly to limit adverse selection?
Answer and explanation
Answer: D. A suicide clause deters a purchase made in contemplation of an early claim, which is adverse selection in its plainest form. Grace, reinstatement and assignment serve the owner's convenience and do not address the selection problem.Source: PSI — New York DFS Insurance Candidate Information Bulletin — Outline, adverse selection
More general insurance questions
- An insured has been careless about locking the premises since buying coverage. Which kind of hazard is that?
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- An insurer discovers within the contestable period that a material fact was concealed. What remedy is rescission?
- An insurer formed under the laws of Connecticut writes business in New York. How is it classified in New York?
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- An insurer has taken late premiums for two years without comment, then declines a claim for late payment. What doctrine answers the insurer?
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