Arizona Term Life Insurance

Life insurance is governed principally by state law. Life insurance is a printed contract, and is basically a promise that the insurance company makes to pay a specified amount of money to a beneficiary when the policyholder passes away.

Life insurance contracts are unique in the world of legal contracts. They are unilateral, aleatory, and contracts of adhesion. They are aleatory in that the insurance company’s promise to pay is based upon an uncertain event… the death of the policyholder within the term stated in the contract. Life insurance contracts are unilateral because the insurer is the only party in the contract making a promise which is legally enforceable. Lastly, life insurance contracts are contracts of “adhesion,” a legal term. The policyholder cannot negotiate the terms of the contract, there is no give and take, and no bargaining which is typically involved in other legal contracts.

Life insurance contracts will have several provisions and clauses such as a Free Look Provision, nonforfeiture clause, Incontestability clause, Grace Period, the right to reinstate, and others.

Most importantly, life insurance policies are material proof, our promise, in a disciplined manner, to provide for our families after we are gone. They are a well thought out plan to insure our loved ones economic well being.