A contract whereby on party undertakes to perform services for the other party as an independent contractor and not as a servant of that other party.
Insurance Encyclopedia
Contract group
See: enrolled group.
Contract loss of profits
Covers airlines against the estimated loss of profit following their inability to complete a specific project due to force majeure, war, repudiation or aircraft failure.
Contract mix
Distribution of types of enrollees who are dependents in insurance health plans (i.e., individual [single] coverage, husband and wife, family, subscriber and spouse, or subscriber and children). This is used to determine average insurance contract size.
Contract month
One month within an insurance contract period. This phrase is used by insurance companies and managed care plans to describe utilization or market share stated in terms of the number of subscriber contracts per month.
Contract number
Numerical identification assigned by an insurance plan to each employer or individual plan. Contract numbers help to identify benefits of specific health insurance plans.
Contract of adhesion
A contract that cannot be bargained over. Insurance contracts are considered contracts of adhesion because the insured cannot negotiate the terms.
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Insurance contracts are usually contract of adhesion. The insured seldom participates in the drafting of the contract although risk managers of large firms may occasionally do so and this practice is apparently becoming more common. Usually, the Insurer offer the insured a printed document on a take-it-or-leave-it basis. Courts frequently refers to this characteristic of Insurance contracts when they interpret ambiguous provisions in favor of the insured.
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MEDICAL,USA: Legal agreement prepared by an insurance company that must be either accepted or rejected completely by the other party (insured), without negotiations between the parties to the agreement. Insurance contracts are contracts of adhesion.
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REFERENCE: See: “Contract of Insurance, Characteristics, Contract of Adhesion.”
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REFERENCE: See: Adhesion contract.
Contract of Affreightment
Contract evidencing the terms of carriage between a shipper and carrier normally expressed in the bill of lading or waybill.
Contract of indemnity
Type of agreement in which the amount of benefit paid is based on the actual amount of financial loss that is determined at the time of the loss. Many hospital expense insurance contracts are contracts of indemnity.
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Property and liability Insurance contracts are, subject to certain exceptions, contracts of indemnity. The person insured under these contracts should not benefit financially from the happening of the event insured against.
Contract of Insurance
Insurance is a contract by which one party in consideration of a price paid to him adequate to the risk becomes security to the other than he shall not suffer loss, damage or prejudice by the happening of the perils specified to certain things to which he may be exposed. It follows that it is applicable to protect men against uncertain events which may in any way be disadvantageous to them, not only to those persons to whom positive loss may arise by such events occasioning the depreciation of that which they possess, but those also who in consequence of such events may have intercepted from them advantage or profit which, but for such events, they would acquire according to the ordinary and possible course of things.