General Insurance✓ Verified · outline & fact-checked · Sep 2026Difficulty 2/5
In the formation of an individual health insurance contract, the usual offer and acceptance pattern is:
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Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
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.
Why the other options are wrong
- B) The policy is the evidence of acceptance, not the offer; the applicant initiated the process with the application.
- C) The agent cannot typically bind individual health coverage; the agent's words are not the offer that creates the contract.
- D) Insurance contracts follow standard offer and acceptance principles like any other contract.
Memory hook
Application = offer. Policy = acceptance. No policy, no contract — the agent's nod is not coverage.