LOMA 281 Module 3 Lesson 2 Questions and Correct Answers
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Course
LOMA 281
Institution
LOMA 281
Entire contract provision An insurance and annuity policy provision that defines the documents that constitute the contract between the insurance company and the policyowner.
Closed contract A contract for which only those terms and conditions that are printed in—or attached to—the contract ar...
LOMA 281 Module 3 Lesson 2 Questions
and Correct Answers
Entire contract provision ✅An insurance and annuity policy provision that defines the
documents that constitute the contract between the insurance company and the
policyowner.
Closed contract ✅A contract for which only those terms and conditions that are printed
in—or attached to—the contract are considered to be part of the contract. Insurance
policy, policy riders, application for insurance.
Open contract ✅A contract that identifies the documents that constitute the contract
between the parties, but all the enumerated documents are not necessarily attached to
the contract. Insurance policy, riders, membership app, declaration of insurability,
fraternal charter, constitution, bylaws.
Free-look provision ✅An insurance and annuity policy provision that gives the
policyowner a stated period of time—usually at least 10 days—after the policy is
delivered in which to examine the policy. Also known as free-examination provision.
Can cancel and get a full refund.
Misrepresentation ✅A false or misleading statement in an application for insurance.
Material misrepresentation ✅A misrepresentation that is relevant to an insurance
company's evaluation of the proposed insured.
Incontestability provision ✅An insurance and annuity policy provision that describes
the time limit within which the insurer has the right to avoid the contract on the ground of
material misrepresentation in the application.
Fraudulent misrepresentation ✅A misrepresentation that was made with the intent to
induce the other party to enter into a contract and that did induce the innocent party to
enter into the contract.
Grace period provision ✅An insurance policy provision that specifies a length of time
following each renewal premium due date within which the premium may be paid
without loss of coverage.
Reinstatement ✅The process by which an insurer puts back into force a life insurance
policy that either has been terminated because of nonpayment of renewal premiums or
has been continued under the extended term or reduced paid-up insurance
nonforfeiture option.
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