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Today’s Lecture

In this lecture, we will explore the types of insurance, fundamental doctrines, agency law, contract requirements, and the distinguishing characteristics of insurance contracts. We will also cover examples and scenarios to further understand these concepts.

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Today’s Lecture

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  1. Today’s Lecture Types of Insurance Fundamental Doctrines Agency Law Contract Requirements Distinguishing Characteristics of Insurance Contracts

  2. Agency Law Three Parties Principal Agent Third Party Agent’s authority can be actual or apparent Agent has binding authority

  3. Agency Law - Example Which party in an insurance contract does the insurance company represent? A Principal B Agent C Third Party

  4. Agency Law (Cont.) Waiver - intentional relinquishment of a known right Estoppel - cannot claim a right previously waived Agency by estoppel is created if someone acts as an agent with the consent of the insurer

  5. Requirements of a Contract Offer and Acceptance Consideration Competent Parties Legal Purpose Legal Form

  6. Requirements of a Contract - Example Fred Guppy

  7. Contract Requirements - Example Which of the requirements of a contract was missing in the Fred Guppy case? A Offer and Acceptance B Consideration C Competent Parties D Legal Purpose or Legal Form E None of the above

  8. Distinguishing Characteristics of Insurance Contracts • Based on Utmost Good Faith • Representations • Concealment • Contracts of Adhesion • Ambiguity is decided in favor of the insured

  9. Distinguishing Characteristics of Insurance Contracts (Cont.) • Indemnity Concept • Insurable Interest • Life - at inception of contract • Property - at time of loss • Subrogation • Insurer obtains right of recovery against other parties • Actual Cash Value • Other Insurance Provisions

  10. Distinguishing Characteristics of Insurance Contracts (Cont.) • Personal • Property-liability policies cannot be assigned • Life policies are assignable

  11. Distinguishing Characteristics - Example An applicant for life insurance indicates on the application that he does not smoke, although he is a heavy smoker. The insurance company, when it learns about this, may be able to void the policy due to: A Misrepresentation B Concealment C Adhesion D Lack of insurable interest E None of the above

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