Completing the Application, Underwriting, and Delivering the Policy
Why is an insurance policy described as a contract of adhesion?
Answer and explanation
Answer: C. A contract of adhesion is drafted by one party and offered on a take-it-or-leave-it basis, which is how the outline lists it among the unique aspects of the insurance contract. Adhering to a payment schedule and to filed forms are different things, and dependence on an uncertain event describes an aleatory contract.Source: Pearson VUE — Georgia Insurance Examination Content Outlines #121102 — Outline page S2, Unique aspects; adhesion
More completing the application, underwriting, and delivering the policy questions
- An insured pays a single monthly premium and dies the next week, and the insurer pays the full face amount. Which contract characteristic does this illustrate?
- An insurer declines an application partly because of a consumer report. Which item belongs in the FCRA adverse-action notice?
- An insurer issues a policy although one health question on the application was left completely blank. What is the usual legal consequence for the insurer?
- An investor offers to fund a policy on a Georgia resident's life if the resident agrees at application to transfer ownership afterward. What is the concern?
- An owner receives a replacement life policy approved under the Insurance Compact standards and decides during the required review period that it is unsuitable. What action preserves the free-look remedy?
- An underwriter wants to obtain an applicant's medical records from a treating physician. What is required first?
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