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Difficulty: EasyAgent Authority and Agency Law

David is a licensed producer for Summit Mutual. His written agency contract explicitly grants him the right to solicit life insurance applications and collect initial premiums on behalf of the insurer. Although the contract does not specifically mention scheduling mandatory medical exams for applicants, David must perform this task because it is a routine and necessary part of processing the life insurance applications he is authorized to sell. Which type of authority permits David to schedule these medical exams?

  1. A
    Express authority
  2. Implied authorityAnswer
  3. C
    Apparent authority
  4. D
    Estoppel

Answer

The correct answer is implied authority.
The correct answer is implied authority because it represents the unwritten, assumed powers a producer has to perform the daily, routine tasks necessary to fulfill the express authority granted in their written contract.

Step-by-Step Solution

1
Analyze the producer's written contract rights.
The contract grants express authority to solicit applications and collect premiums, but is silent on scheduling medical exams.
Identifying what is explicitly written helps eliminate express authority as the answer.
2
Evaluate the nature of the unwritten task.
Scheduling the exams is a necessary, routine step to fulfill the express duty of processing the applications.
Understanding the relationship between the unwritten task and the written duties defines the type of unwritten authority.
3
Match the task's nature to the correct agency law concept.
Authority that is not written but is necessary to conduct the agent's express business is defined as implied authority.
This directly applies the legal definition of implied authority to the scenario.

Key Concept

Implied Authority in Agency Law
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Topics

Agent Authority and Agency Law

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