Legal Concepts Flashcards
Which element of a contract constitutes a definite and unqualified proposal by one party to another ?
A. Adhesion
B. Consideration,
C. Acceptance,
D. Offer 
D.offer
Doing the application process, a statement made by an applicant that becomes part of the contract is considered to be a
Warranty
A producer working for an insurance company may be personally liable for 
A. Acts performed which are expressed in the agency contract.
B. Acts performed which are prohibited in the agency contract
C. All actions taken on behalf of the issuer
D.Nothing
B.
Which of the following relationships demonstrates insurable interest in the absence of economic interest? 
A.Lifelong friends
B.employees
C.marriage partners
D.business associates 
Marriage partners 
What happens when an initial offer is answered with a counter offer?
Initial offer is void 
Christopher is issued an insurance policy that contains an attached agreement which alters the terms of the policy. This attachment is called a.
Endorsement
In what way are insurance policies said to be aleatory? 
A. Only one party makes any kind of enforceable promise.
B. Involve the potential for the unequal exchange of value.
C. Contract is prepared by only one party.
D. vagueness in a contracts wording is resolved in favor of the policy owner 
B. Involve the potential for the unequal exchange of value
An agreement is reached when an insurance contract is formed. Which of the following is NOT considered to be an element of an agreement ?
A.Meeting of the minds
B.Offer
C.Acceptance
D.Equity
D.Equity
An agent whose actions exceeded the authority, granted by contract is 
A. Acting under a parent authority.
B. Acting under applied authority.
C. Not backed by the insurer
D.backed by the insurer
C. Not backed the insurer
XYZ insurance company gives direct authority to its producers to sell insurance through an agency contract, but nothing is stated regarding the collection of premiums. Which authority grants to producer the right to collect premiums ? 
A. Implied Authority
B. Apparent Authority
C. Express authority
D. Assumed Authority
A.
Greg applies for insurance and makes a false statement on the application that will influence whether or not the insurer will accept the risk. Greg’s false statement is called a
Material misrepresentation
Which of the following would not have a restricted ability to enter into a contract ?
A. Mentally ill person
B. Minor
C. Person under the influence of alcohol
D. Small employer
D.
Insurable interest involves what assumption ?
One person benefits from another person is continued life 
Which of the following situations would an assurance agent need to guard against liability for professional errors and omissions? 
A. remitting premiums to in insurer
B. Conducting a sales meeting with other agents.
C.Making a recommendation to a potential insured to replace existing coverage
D. Setting a sales appointment with a potential client 
C
The powers directly given to a producer in an agency contract are called 
Express
