RETAKE Chapter 2: Policy Provisions and Contract Laws

Question 1

Appraisal DEF.
What happens if there is not an agreement made?

Answer 1

A disagreement between the insurer and the insured of VALUE of property loss

will select and umpire; if cannot agree on UMPIRE, American Arbitration (AAA) appoints one

Question 2

Agreement vs Assignment

Answer 2

offer and acceptance (element of ins.) “starting the contact”

the transfer of a legal right or interest of an ins. policy
“handing it off (with permission)”

Question 2

Insurance Agreement def. and FIVE contents

Answer 2

establishes the obligations of the INS COMP> to provide the ins. COV. as stated in policy

1. contracts
2. effectiveness
3. renewal dates
4. des. of cov.
5. perils

Question 3

Conditions Def. and FOUR Contents

Answer 3

Indicates general rules or procedures agreed under terms of policy
1. Inspections
2. Changes to the policy
3. liberazation clause
4. return of premium

Question 4

Decleration def. and FIVE contents

Answer 4

Contains the basic underwriting info:
1. name
2. address
3. amount of cov.
4. amount of premuim
5. dec. of Loaction

Question 4

Considerations

Answer 4

Insured- consideration is PAYMENT OF PREMIIUM & REPRESENTATION

INSURER- consideration is the PROMISE TO PAY LOSSES

Question 5

Fair Credit Reporting Act

Answer 5

Administrated by federal trade commissions

Proctes consumers from any distributing false of obsolete personal financial info

Question 6

Sources of Insurabliity? INFO that is used (5)

Answer 6

used before underwritting process
1. Application form
2. Motor Vehicle Records
3. Interviews w/ neighbors, friends
4. Inspection of property
5. Inspection of insurance history

Question 7

Arbitration

Answer 7

disagreement on how to SETTLE CLAIMS sent to one or more arbitrators

Question 8

The condition section outlines

Answer 8

duties after a loss (like proof of loss, cooperation, etc.).

Question 9

A unilateral contract means

Answer 9

only one party (insurer) makes a legally enforceable promise (to pay a claim).

Question 10

Contracts of adhesion are

Answer 10

“take it or leave it” — the insured must accept the terms as written.

Question 10

How does an agreement work?

Answer 10

The insured makes the offer (by applying), and the insurer accepts (by issuing the policy).

Question 11

Insurance contracts are (4)

Answer 11

are personal,
conditional,
unilateral,
adhesive.

Question 12

When does an applicant make an offer?

Answer 12

The applicant makes the offer when submitting the app — insurer accepts or rejects.