BUL 3130 Chapter Notes - Chapter 51: Arbitration Clause, Insurance Law, Property Insurance
Document Summary
Insured party- the one who makes a payment in exchange for a later payment in the event of damage or injury to property or person: premium- an insurance payment. Insurance plays an important role in risk management. Insurance law articulates the rules that govern the insurance relationship. Incontestability clause- a state-mandated clause ensuring that after an insurance policy has existed for a specified period (usually two years), the insurance company cannot contest any statements made in the application. Insurer wants to cancel: the company must give the insured advance notice, typically including a grace period, before the policy is canceled. The insured may also be entitled to a refund of premium payments. Cash-surrender value- permits the owner of the policy to borrow money from the insurance company at a favorable interest rate: term-life insurance- provides coverage for a specified term.
