When an insured makes truthful statements on the application for insurance and pays the required premium, it is known as which of the following?

A. Contract of adhesion

B. Acceptance

C. Consideration

D. Legal purpose

The answer is C. Consideration.

Explanation:

In terms of insurance, consideration refers to the fact in which the insurance company gives adequate consideration in terms of coverage for losses when premiums are being paid. If a person wants to continue receiving this benefit, he or she could buy a policy as well as pay premiums.

Insurance can be considered a business and in this way, one party can get benefits from another one when there is a trade of something that has an important value. This is called paying premiums regarding the insurance world.