Contract Law Flashcards
(45 cards)
What is a contract in the context of insurance?
A legally binding agreement between an insurer and the insured.
True or False: An insurance contract is typically unilateral.
True
Fill in the blank: The principle of ________ requires that both parties in an insurance contract have an understanding of the terms.
utmost good faith
What does ‘insurable interest’ mean?
The requirement that the insured must have a stake in the subject matter of the insurance.
Which party is known as the ‘insurer’?
The company providing the insurance coverage.
What is ‘consideration’ in an insurance contract?
The premium paid by the insured in exchange for coverage.
True or False: An insurance policy can be voided if the insured provides false information.
True
What is the ‘risk’ in insurance terms?
The possibility of a loss occurring.
What does ‘exclusion’ refer to in an insurance policy?
Specific conditions or circumstances that are not covered by the policy.
Name one type of insurance contract.
Life insurance, health insurance, auto insurance, etc.
What is ‘subrogation’?
The right of an insurer to pursue a third party responsible for a loss after compensating the insured.
Fill in the blank: The ________ clause ensures that the insured can claim only the amount of loss suffered, not more.
indemnity
True or False: Insurance contracts are always written documents.
False
What is a ‘declarations page’ in an insurance policy?
A section that outlines the key details of the policy, including coverage amounts and premium.
What does ‘premium’ mean in insurance?
The amount paid for the insurance coverage.
True or False: A breach of contract can lead to the termination of an insurance policy.
True
What is ‘policy limits’?
The maximum amount an insurer will pay for a covered loss.
What does the term ‘underwriting’ refer to?
The process of evaluating risk and determining the appropriate premium for an insurance policy.
Fill in the blank: An insurance policy typically requires the insured to pay a ________ before the insurer covers a loss.
deductible
What is the ‘insuring agreement’ in an insurance policy?
The section that outlines the coverage provided by the policy.
What does ‘claims process’ refer to?
The procedure for an insured to report a loss and request payment from the insurer.
True or False: An insurance contract must be fair to both parties.
True
What is ‘aggregate limit’?
The total limit of coverage available under a policy during a specified time period.
What does ‘waiver’ mean in insurance contracts?
The voluntary relinquishment of a known right or privilege.
