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The insurance contract in which ONLY one party, the insurer, makes a promise to another is known as ________.

1) Unilateral Contract
2) Bilateral Contract
3) Mutual Contract
4) Voidable Contract

1 Answer

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Final answer:

An insurance contract where only the insurer makes a legally enforceable promise is known as a unilateral contract, with the insured's role primarily involving premium payments.

Step-by-step explanation:

The insurance contract in which ONLY one party, the insurer, makes a promise to another is known as a unilateral contract. This type of contract is distinct in the way that it only requires one party to make a promise or perform an action. An example of this would be a life insurance policy where the insurance company promises to pay a specified amount of money upon the death of the insured, while the insured is only required to make premium payments without any promise of action.