General Insurance PrinciplesQuestion 188 of 315
Because an insurance policy is a contract of adhesion, California courts will interpret any ambiguity in the policy:
a.In favor of the insured
b.In favor of the agent who delivered the policy
c.In favor of the insurer who drafted the policy
d.Strictly according to industry custom
Explanation
A contract of adhesion is drafted by one party (the insurer) and offered on a take-it-or-leave-it basis. Because the insured had no chance to negotiate the wording, California courts construe any ambiguity against the drafter and in favor of the insured.
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Sen Lin, PrepPass Founder · Verified against California Life & Health Insurance License Exam · How we review
Reviewed by John Zihao Zhang — California-Licensed Life Insurance Agent (CA Dept. of Insurance License #4396095 — verify)