Insurance - Study Mode

[#551] When an insurance contract can be declared void?
Correct Answer

(C) A & B are correct

Explanation

Solution: Insurance contract can be declared void in both Innocent misrepresentation and fraudulent misrepresentation. Innocent misrepresentation is a misrepresentation made by someone who had reasonable grounds for believing that his false statement was true. Fraudulent misrepresentation is a civil tort arising out of contract law. It is a false statement of fact that causes or induces someone to enter into a contract.

[#552] Why insurance contract is an Adhesion Contract?
Correct Answer

(A) Insurance Co. has all the bargaining power

Explanation

Solution: Adhesion contract is a legally binding agreement between two parties to do a certain thing, in which one side has all the bargaining power and uses it to write the contract primarily to his or her advantage.

[#553] Which of the following is not a long term goal of an individual?
Correct Answer

(C) Buying a TV set

Explanation

Solution: Buying a TV set is not a long term goal of an individual. A long-term goal is something you want to accomplish in the future. Long-term goals require time and planning.

[#554] Which of the following could be termed the need of an individual?
Correct Answer

(D) All of the above

Explanation

Solution: Specific transaction needs, General transaction needs and Meeting contingencies could be termed the need of an individual.

[#555] Which of the following is a Contingency product?
Correct Answer

(D) Insurance

Explanation

Solution: Insurance is a Contingency product. The Contingency Insurance Industry is a specialized group of individuals that deal with insurance products that usually fall outside of the more easily recognized property, marine, casualty, and financial services departments of most companies.