Question

5. With respect to life insurance, the insurable interest must exist at some future time. O a. True O b. False 6. For property insurance, the insurable interest must exist at the time of the loss but need not exist when the policy is purchased. O a. True O b. False 7. When the parties to an insurance application agree that the policy will be issued and delivered at a later date, the contract is not effective until the policy is issued and delivered. O a. True O b. False 8. A binder is a(n): O a. bid on an insurance policy O b. application for insurance O c. written, temporary insurance policy O d. codicil to an insurance policy 9. Typically, a coinsurance clause provides that if the owner insures the property up to a specified percentage -usually Select v of its value, she or he will recover any loss up to the face amount of the policy. 10. An incontestability clause provides that: O a. an insurance policy cannot be canceled by the insured before the end of the policy term O b. an insurance policy cannot be canceled by the insurer before the end of the policy term O c. the insurer may not contest statements made on an application for insurance after a specific time period has lapsed O d. the insured may not contest statements made in the initial insurance contract after a specified time period has lapsed 11. When a provision in an insurance policy is ambiguous or unclear, the courts usually interpret the provision Select the insurance company.

Answer 1

ANSWERS

ANS 5) The Correct Option is - False

ANS 6) The Correct option is - True

ANS 7) The Correct Option is - True

ANS 8) The Correct Option is C - Written, temporary insurance policy

ANS 9) The Correct Answer is 80 percent

ANS 10) The Correct Option is C - The insurer may not contest statements made on an application for insurance after a specified time period has lapsed.

ANS 11) When a provision in an insurance policy is ambiguous or unclear, the courts usually interpret the provision against the insurance company.