LOMA 280 Principles Of Insurance
Questions and Answers 100% Solved
4 requirements for an informal contract Correct Ans-1. Parties express mutual assent to terms
2. Parties exchange legally adequate consideration
3. Contract is for a lawful purpose
4. Parties have contractual capacity
Mutual assent Correct Ans-Meeting about the terms of an agreement
Offer Correct Ans-Proposal to enter a binding contract. Party that makes offer is offerer party
that accepts offer is offeree
Acceptance Correct Ans-Offeree's unqualified agreement to be bound to the terms of an offer
Consideration Correct Ans-Each party must give or promise something if value to the other
party
,Initial premium Correct Ans-First premium paid for an insurance policy
Renewal premiums Correct Ans-Premiums payable after initial premium for continuance
Contractual capacity Correct Ans-Each party must have legal capacity to make a contract for
an informal contract to be binding
2 times when mental capacity affects contractual capacity Correct Ans-1. Court declares
person to be insane or mentally incompetent
2. Persons mental competence is impaired but they have not been declared insane or incompetent
by court
Bilateral contract Correct Ans-Both parties make legally enforceable promises
Unilateral contract Correct Ans-Only one of the parties makes a legally enforceable promise
(insurance policy)
Commutative contract Correct Ans-Agreement where parties specify the values they exchange
in advance
, Aleatory contract Correct Ans-One party provides something of value to another party in
exchange for a conditional promise
Conditional promise Correct Ans-Promise to perform a stated act if a specified uncertain event
occurs (life insurance)
Bargaining contract Correct Ans-Both parties set terms and conditions as equals
Contract of adhesion Correct Ans-Contract one party prepares and the other must accept (life
insurance)
Life insurance contract Correct Ans-Informal
Unilateral
Aleatory
Contract of adhesion
Financial design Correct Ans-Set of values for numerous elements of the product
Questions and Answers 100% Solved
4 requirements for an informal contract Correct Ans-1. Parties express mutual assent to terms
2. Parties exchange legally adequate consideration
3. Contract is for a lawful purpose
4. Parties have contractual capacity
Mutual assent Correct Ans-Meeting about the terms of an agreement
Offer Correct Ans-Proposal to enter a binding contract. Party that makes offer is offerer party
that accepts offer is offeree
Acceptance Correct Ans-Offeree's unqualified agreement to be bound to the terms of an offer
Consideration Correct Ans-Each party must give or promise something if value to the other
party
,Initial premium Correct Ans-First premium paid for an insurance policy
Renewal premiums Correct Ans-Premiums payable after initial premium for continuance
Contractual capacity Correct Ans-Each party must have legal capacity to make a contract for
an informal contract to be binding
2 times when mental capacity affects contractual capacity Correct Ans-1. Court declares
person to be insane or mentally incompetent
2. Persons mental competence is impaired but they have not been declared insane or incompetent
by court
Bilateral contract Correct Ans-Both parties make legally enforceable promises
Unilateral contract Correct Ans-Only one of the parties makes a legally enforceable promise
(insurance policy)
Commutative contract Correct Ans-Agreement where parties specify the values they exchange
in advance
, Aleatory contract Correct Ans-One party provides something of value to another party in
exchange for a conditional promise
Conditional promise Correct Ans-Promise to perform a stated act if a specified uncertain event
occurs (life insurance)
Bargaining contract Correct Ans-Both parties set terms and conditions as equals
Contract of adhesion Correct Ans-Contract one party prepares and the other must accept (life
insurance)
Life insurance contract Correct Ans-Informal
Unilateral
Aleatory
Contract of adhesion
Financial design Correct Ans-Set of values for numerous elements of the product
