Terms 2

Question 1

A contract that has been prepared by one party with no negotiation between the applicant and insurer

Answer 1

Adhesion

Question 2

Represents themselves and the insurer

Answer 2

Agent

Question 3

Presents the potential for an unequal exchange of value or consideration between both parties

Answer 3

Aleatory

Question 4

The appearance of the insurer providing the agent authority to perform unspecified tasks based in the agent insurer relationship

Answer 4

Apparent authority

Question 5

Represents themselves and the insured

Answer 5

Broker

Question 6

One who is capable of understanding the contract being agreed to

Answer 6

Competent party

Question 7

The failure of the applicant to disclose a known material fact when applying for insurance

Answer 7

Concealment

Question 8

The insurers promise to pay benefits depending on the occurrence of an event covered by the contract

Answer 8

Conditional

Question 9

Sets forth the amount of invites and renewal premiums and frequency of future payments

Answer 9

Consideration

Question 10

Provides insurer with a completed application and initial premium as consideration for insurance

Answer 10

Applicant

Question 11

The legal impediment to one party denying the consequences of its own actions or deed if such actions or deeds result in another party acting in a specific manner or if certain conclusions are drawn

Answer 11

Estoppel

Question 12

Explicit authority granted to the agent in the agency contract

Answer 12

Express authority

Question 13

The responsibility an insurance producer has to account for all premiums collected and provide sounds financial advice to clients

Answer 13

Fiduciary

Question 14

The deliberate knowledge of or intentional deceit to make false statements to be compensated by an insurance company

Answer 14

Fraud

Question 15

An authority not explicitly granted to the agent in the contract of agency, but which common sense dictates the agent has

Answer 15

Implied authority

Question 16

Attempt to return the insured to their original financial position

Answer 16

Indemnity contract

Question 17

The financial, economic, and emotional impact associated with a person experiencing a specified loss

Answer 17

Insurable interest

Question 18

A written contract

Answer 18

Insurance policy

Question 19

Means an insurance contract must be legal in nature

Answer 19

Legal purpose

Question 20

A false statement made by an applicant that would influence an insurer in determining whether or not to accept the risk

Answer 20

Material misrepresentation

Question 21

Parties put their agreement in writing

Answer 21

Parole evidence rule

Question 22

An amendment added to an insurance contract that overrides terms in original policy

Answer 22

Rider or endorsement

Question 23

The insured in entitled to coverage under a policy that any sensible and prudent person would expect it to provide

Answer 23

Reasonable expectations

Question 24

Statement made by the applicant they consider to be true

Answer 24

Representations

Question 25

Right for an insurer to pursue a third party that caused an insurance loss to be insured

Answer 25

Subrogation

Question 26

Only one party makes any kind of enforceable promise

Answer 26

Unilateral

Question 27

The belief that both the policy owner and the insurer must know all the material facts and relevant information

Answer 27

Utmost good faith

Question 28

Pays a stated sum regardless of the actual loss incurred

Answer 28

Valued contract

Question 29

May be set aside by one of the parties in the contract for a reason unsatisfactory to court

Answer 29

Voidable contract

Question 30

Voluntarily giving up of a legal given right

Answer 30

Waiver

Question 31

Statement made by the applicant that is guaranteed to be true in every aspect

Answer 31

Warranty

Question 32

What are the 4 essential elements that must be contained in every contract

Answer 32

Offer and acceptance
Consideration
Legal purpose
Competent parties

Question 33

Requires full compensation for proved harm

Answer 33

Tort law

Question 34

An insurance where the insurer agrees to pay sums that the agent legally is obligated to pay for injuries resulting from professional services that he rendered or failed to render

Answer 34

Errors and omissions professional liability insurance