Multiple choice

An insurance policy is a contract and is an example of a:

  1. Bilateral contract

  2. Unilateral contract
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

An insurance policy is considered a unilateral contract because only one party, the insurer, makes a legally enforceable promise to pay for covered losses. The insured does not promise to pay premiums, though they must do so to keep the policy in force.

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