ic24 Mock Test- Legal Aspects of Life insurance ( by iexamworld).
A contract between the insured and the insurer is referred to as a life insurance policy. Simply put, the insured pays the premiums, and the company compensates the insured with a variety of benefits. The insured’s needs and goals are focused on while selecting life insurance. Insurance’s primary goal is to assist the insured and his family during their hard times. Accidents, illness, and death are all covered by life insurance. The insurer, the insured, the applicant-policy owner, and the beneficiary are the four parties to a life insurance contract. Life Insurance is a legal document, and neither party can deny or deviate from the points written in the documents. Under this, both parties must follow the legal rules.
Proper compliance from both sides allows it to function smoothly. Everything is in writing, whether from the insured parties or the insurance company. Insurable interest requirements, age misstatement, legal form and contents, modes of settlement, dividend clause, automatic premium loan, name or changing the name of nominees, and so on are all in writing. The insurance company also offers a free look period during which the owner of a life insurance policy can cancel the policy without penalty. It usually lasts 10 days or more. During this time, policyholders have the option to cancel if they find the policy unsuitable or are dissatisfied with it. During this time, the buyer can seek additional information about the policy. This period allows the policyholder to review the policy and its various aspects.
The policyholder has complete control over the policy and can even gift it. The policy can be given to the policyholder’s spouse, parents, or children. Similarly, an employer can give it to his or her employees, as well as to his or her relatives, such as his or her spouse or child. The spouses have a life insurance policy on each other. The creditor is allowed to take insurance policies in the business. A guaranteed survival benefit is given to a policyholder during or after the completion policy period. The policyholder’s nominee cannot receive the death benefit due to a suicide clause. The policy will be invalid if the life assured commits suicide.
Though this agreement is subject to revision, negotiation, and other factors, and once an agreement is reached, both parties must follow it. As a result, it can be said that the life insurance policy is primarily concerned with consumer protection and is unique in contract law. It is referred to as an “aleatory, unilateral contract of adhesion” in legalese.