Canadian Accredited Insurance Broker (CAIB) One Practice Exam

What is the term for the act of intentionally giving up some right or privilege?

1. A representation

2. A transfer

3. A waiver

4. Subrogation

The correct answer is: A waiver

The term for the act of intentionally giving up some right or privilege is known as a waiver. A waiver indicates that an individual or party voluntarily relinquishes their right to enforce a claim or to exercise a given privilege, often seen in legal agreements and contracts. In a practical sense, waivers are used in various settings, such as when signing a release form before participating in an activity that could pose a risk, where participants acknowledge the risks involved and give up their right to sue for injuries sustained. This concept is essential in insurance and legal contexts, as it highlights the importance of understanding rights and the implications of forgoing them. Understanding waivers helps in comprehending broader legal principles and risk management practices, making it a crucial concept to grasp for those studying insurance-related fields.