Question

Steven was denied coverage, a jury decided in his favor. Why are insurance policies considered "Contracts of Adhesion"?

a) The terms are negotiated between parties
b) The insured has the power to draft the policy
c) The insured has limited input in policy terms
d) The insurer is bound by the insured's terms

Answer 1

Insurance policies are considered 'Contracts of Adhesion' because the insured has limited input in policy terms. So, the correct answer is c) The insured has limited input in policy terms.

Step-by-step explanation:

Insurance policies are considered "Contracts of Adhesion" because the insured has limited input in policy terms.

In this type of contract, the terms are offered by the insurance company on a take-it-or-leave-it basis, and the insured has no real opportunity to negotiate or modify the terms.

The policy is drafted and prepared by the insurer, and the insured has to accept the terms as they are or decline the coverage.

Thus, the correct answer is c) The insured has limited input in policy terms.