Offer and Acceptance
The contract formation step in insurance. Typically the applicant's signed application and initial premium are the offer, and the insurer's issuance of the policy is acceptance.
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Practice This Concept
In the formation of an individual health insurance contract, the usual offer and acceptance pattern is:
The application is the offer; the insurer's acceptance, typically by issuing the policy, completes the contract — The applicant makes the offer by submitting a completed application; the insurer accepts by issuing and delivering the policy (or approving the application). In individual health insurance the agent generally has no authority to bind coverage, so no contract exists until the insurer acts. The conditional receipt, where used, provides temporary coverage while underwriting completes.
National insurance concept
Which of the following is NOT required for a valid insurance contract?
A notarized policy document signed before a notary public — The four elements of a valid contract are agreement (offer and acceptance), consideration, competent parties, and a lawful purpose. Insurance policies must also satisfy statutory requirements, such as the required specifications under CIC Section 381, and the policy is defined as a written instrument. But no notarization is required — a policy does not need to be notarized to be valid. The other three choices are core contract elements that must all be present for enforceability.
CA-specific example
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