In insurance, a contract is effective when there is mutual consideration, offer, acceptance, and a meeting of the minds. For a health insurance contract, this occurs when the insured pays the initial premium (consideration from the insured) and the insurer issues the policy as applied for (acceptance by the insurer), as outlined in Oklahoma’s Insurance Code (Title 36 O.S. § 4401). The policy becomes binding at this point, assuming all other conditions (e.g., underwriting approval) are met.
Option A: Incorrect. Providing services occurs during claims, not when the contract is effective.
Option B: Incorrect. Paying the premium alone is not sufficient without policy issuance.
Option C: Correct. The contract is effective when the premium is paid and the policy is issued as applied for.
Option D: Incorrect. Signing by both parties is not typically required; issuance and premium payment suffice.
This question aligns with the Prometric content outline under “Provisions, Options, Exclusions, Riders, Clauses, and Rights,” which covers contract formation in health insurance.
[:, Prometric Oklahoma Life, Accident, and Health or Sickness Producer Exam Content Outline (Section: General Knowledge – Accident and Health Insurance)., Oklahoma Insurance Department, Title 36 O.S. § 4401 (health insurance contracts)., Standard insurance study guides (e.g., Kaplan, ExamFX) for Oklahoma producer licensing., , , , ]
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