XCEL Ch. 3 Keywords Exam Questions and
Answers with Verified Solutions | Latest
Updated 2026
Adhesion describes a contract that has been
prepared by
one party parentheses the insurance
company
parentheses with no negotiation between
the
applicant and insurer. The applicant
adherence to
the terms of the contract on a "take it or
leave it"
basis when accepted.
Agent represents themselves and the insurer at
the time of
application
Aleatory This contract presents the potential for an
unequal
exchange of value or consideration
between both
parties. These contracts are conditioned
upon the
occurrence of an event.
, Apparent Authority The appearance of the insurer, providing
the agent
authority to perform unspecified tasks
based on
the agent-insurer relationship
Broker represents themselves and the insured
(i.e., the
client or customer) at the time of
application
Competent Party One who is capable of understanding, the
contract
being agreed to. All parties must be of
legal
competence, meaning they must be of
legal age,
mentally capable of understanding the
terms, and
not influenced by drugs or alcohol.
Concealment The failure of the applicant to disclose a
known
material fact when applying for assurance
Conditional describes the insurer's promised to pay
benefits
depends on the occurrence of an event
covered
by the contract
Answers with Verified Solutions | Latest
Updated 2026
Adhesion describes a contract that has been
prepared by
one party parentheses the insurance
company
parentheses with no negotiation between
the
applicant and insurer. The applicant
adherence to
the terms of the contract on a "take it or
leave it"
basis when accepted.
Agent represents themselves and the insurer at
the time of
application
Aleatory This contract presents the potential for an
unequal
exchange of value or consideration
between both
parties. These contracts are conditioned
upon the
occurrence of an event.
, Apparent Authority The appearance of the insurer, providing
the agent
authority to perform unspecified tasks
based on
the agent-insurer relationship
Broker represents themselves and the insured
(i.e., the
client or customer) at the time of
application
Competent Party One who is capable of understanding, the
contract
being agreed to. All parties must be of
legal
competence, meaning they must be of
legal age,
mentally capable of understanding the
terms, and
not influenced by drugs or alcohol.
Concealment The failure of the applicant to disclose a
known
material fact when applying for assurance
Conditional describes the insurer's promised to pay
benefits
depends on the occurrence of an event
covered
by the contract
