What Is the Practical Effect of an Insurance Contract Being

question 53

Multiple Choice

What is the practical effect of an insurance contract being a contract of adhesion?

• A)The insurer can refuse to pay claims if the insured has not complied with all policy provisions.
• B)The insured can assign the policy only with the insurer's consent.
• C)The insurer can sue the insured for failure to pay any premiums.
• D)The policy is interpreted in the insured's favor if the policy contains any ambiguities or uncertainties.

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Definitions:

Firm

An organization that uses resources to produce goods or services for profit in an economic system.

Goods

Items or products that are produced to satisfy wants or needs of consumers. Goods can be tangible, like food and cars, or intangible, like services.

Services

Intangible and non-physical goods provided by individuals or companies, such as healthcare, education, and financial consulting.

Total Product

The total quantity of output produced by a firm or economy as a result of its production process.