Page 16 - Life Assurance

Other parties who have no legal capacity to
contracts are:

(1) Insane persons-those who do not have the
ability to understand the nature of the agreement
into which they enter.

(2) Intoxicated person and
(3) Corporations that act outside the scope
of their authority.

4/3/4 Offer and acceptance

An insurance agreement is effected by one
party making an offer, and by the other party
accepting that offer. To be valid an offer must be
communicated effectively to the offered. An offer
can be withdrawn at any time before it is accepted.
Therefore, it becomes important to determine, what
constitutes a legal offer. If Kamel goes to an agent
to purchase insurance and the agent fills out an
application that Kamel signs, has the agent made an
offer which Kamel accepts by signing the application
if so, the insurance is in force. If not, when is the
contract in effect? The answers to these questions
are necessary in determining when coverage.

It is the general rule in insurance that it is
the applicant, who makes the offer. The agent
merely solicits an offer and the insurance
company has the authority to accept the
applicant's offer for insurance. The insurer
serves this right, and the policy is not bound

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