What constitutes an offer in an insurance context?

In the context of insurance, an offer is typically established when the insurer's underwriter evaluates and approves an application for coverage. This action confirms the insurer's willingness to provide insurance under the terms outlined in the application. The approval signifies that the insurer has agreed to the terms suggested by the applicant and is ready to enter into a contractual agreement to provide insurance coverage.

Submitting an application is only the first step from the applicant's side; it does not constitute an offer until it has been reviewed and accepted by the insurer. Thus, while the application indicates an intent to enter into an insurance agreement, it is the underwriter's approval that transforms the potential agreement into a formal offer from the insurer to the applicant. The issuance of a policy comes later, as it formalizes the contract after the offer has been accepted.

Explaining a policy to a potential applicant by an agent is also not an offer. It merely serves to inform the applicant about the coverage and terms available, but without the underwriting approval or issuance of the policy, it does not imply an acceptance of an offer.