Adhesion ***(unique to insurance)

MR. WATSON: A contract of Adhesion . Only one side has prepared the contract, the insurer. Adhere. To "stick to". Who sticks it to whom? The insurance company. Who prepares an insurance contract?

STUDENTS: Insurance company.

MR. WATSON: Only the insurance company. Do you have any say-so in how it's prepared?

STUDENTS: No.

MR. WATSON: The company says we will cover this if you die, but if you die this way, exclusions, we are not paying. Can you negotiate that?

STUDENTS: No.

MR. WATSON: Insurance contracts are contracts of adhesion . Take it or leave it. Only one party prepares them. Which party is that?

STUDENTS: The insurance company.

MR. WATSON: "Adhesion " means prepared by --

STUDENTS: One party, the insurance company.

MR. WATSON: It's not negotiable. Take it or leave it. Don't confuse it with a one-sided contract, Unilateral with Adhesion . Who drew up the contract?

STUDENTS: Insurance company.

 

Conditional (unique to insurance)

MR. WATSON: Conditional. The company's promise to pay is conditional upon what?

Man: The guy being dead or getting sick.

MR. WATSON: If the risk does not materialize, the company doesn't have to pay. Again, this is unique to insurance contracts.