Elements of insurance Flashcards
1
Q
Indemnity
A
- Only indemnified for up to the actual loss amount
- an exception is life insurance, which pays the stated face value
2
Q
Personal contract
A
Nontransferable
3
Q
Contract of adhesion
A
Take it or leave it
4
Q
Contract of utmost good faith
A
May be adjusted by
- Misrepresentation of fact
- Misrepresentation of opinion
- Concealment
- Waiver
- Estoppel
5
Q
Unilateral contract
A
Only the insurer makes legally enforceable promises
6
Q
Conditional contract
A
Premium must be paid, and a covered loss must occur
7
Q
Aleatory contract
A
Outcome affected by chance; dollars collected by the parties may not be equal
8
Q
Subrogation
A
If the insurer pays the insured for a loss caused by a third party, the insured is required to assign his right to recover from the third party to the insurer
