P&CCaliforniaeasy
Under the California Insurance Code, which definition most accurately captures 'insurance' as used in § 22?
AAny financial guarantee in which one party promises to pay a sum certain on a date certain to another, with no contingent or fortuitous event required to trigger the obligation
BA wager between two parties on the outcome of an uncertain future event in which neither party holds an insurable interest in the subject of the bet
CA government program that pools tax revenues to compensate citizens for accidental losses without any individual contract or transfer of risk
A contract whereby one party undertakes to indemnify another against loss, damage, or liability arising from a contingent or unknown event
Why this is the answer
California Insurance Code § 22 defines insurance as a contract whereby one party undertakes to indemnify another, or to pay or allow a specified or determinable benefit, upon the occurrence of determinable contingencies. The three required elements are (1) a contract, (2) a transfer of risk, and (3) a contingent or unknown event. A pure financial guarantee with no contingency, or a wager where neither party has an insurable interest, falls outside the statutory definition. The California statutory definition tracks closely with common-law indemnity principles. See Ins. Code § 22.
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