PSI Ohio Insurance Practice Exam

Disable ads (and more) with a membership for a one time $2.99 payment

Study for the Ohio Insurance Test. Prepare with flashcards and multiple choice questions, each question accompanied by hints and explanations. Excel in your exam!

Each practice test/flash card set has 50 randomly selected questions from a bank of over 500. You'll get a new set of questions each time!

Practice this question and more.

What is the term for the legal agreement between an insurer and insured?

Policy
Contract
Endorsement
Liability

The correct answer is: Contract

The legal agreement between an insurer and insured is referred to as a contract because it establishes the terms and conditions under which the insurer agrees to provide coverage and the insured agrees to pay premiums. This agreement outlines the rights and obligations of both parties, including the specifics of coverage, exclusions, limits, and conditions. A policy is a type of contract that specifies the particulars of the insurance coverage, serving as the document that encapsulates the contractual relationship. Endorsements are amendments or additions to the policy that modify the coverage provided, while liability generally refers to legal obligations for damages or injury. Understanding that the overarching term governing the relationship is "contract" helps clarify the essential framework within which an insurer-insured relationship operates.