Completing the Application, Underwriting, and Delivering the Policies
Why is a life insurance policy described as a contract of adhesion?
Answer and explanation
Answer: D. A contract of adhesion is one drafted by one party and offered to the other on a take-it-or-leave-it basis, which is how the Florida outline lists it among the unique aspects of the insurance contract. Being bound on one side describes a unilateral contract, and dependence on an uncertain event describes an aleatory one.Source: Pearson VUE — Florida Insurance Examination Content Outlines #121003 — Outline page S2, Unique aspects of the insurance contract
More completing the application, underwriting, and delivering the policies questions
- What does the applicant give as consideration in forming a life insurance contract?
- What does the term 'unilateral' mean in relation to a life insurance contract?
- What is the basic purpose of life insurance underwriting?
- What is the most direct underwriting consequence of leaving required application answers incomplete?
- What right does the GLBA opt-out notice provide to policyowners regarding nonpublic personal financial information?
- When a corporation is the proposed policyowner, what should identify the person signing for it?
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