In an insurance contract, when is the offer usually made?

• A. When the insurance application is submitted
• B. At policy issue
• C. Upon delivery of the policy
• D. After underwriting approval

Answer: (A)

In insurance, the applicant initiates the contract by submitting the application. That submission is treated as an offer to enter into an insurance contract. The insurer reviews the information, may underwrite and approve, and the contract is formed when the insurer issues the policy (and often after the premium is paid). So the act of applying is the moment the offer is made because it asks the insurer to bind coverage.

Choosing the policy issue would be the insurer accepting the offer and issuing the contract, not the moment the offer is made. Delivery of the policy is simply the final transfer of the contract to the insured, and underwriting approval is part of the process that leads to acceptance, not the initial offer itself.