Why are insurance contracts considered conditional?

Insurance contracts are considered conditional primarily because they mandate that certain specific conditions must be fulfilled for the insurance coverage to be triggered or for benefits to be paid. This means that the obligations of the insurer to provide payment or services depend upon the insured fulfilling these predefined conditions. For example, in the case of a health insurance policy, the insured must seek medical treatment and file a claim within the stipulated time frame for the insurer to process and pay for the incurred medical expenses.

While an insurance contract may have a specific time period of validity, it is the presence of these conditions that fundamentally defines the relationship between the insurer and the insured. The stipulations outlined in the policy detail what must happen for coverage to apply, ensuring that the insurer is clear about its obligations and that the insured knows the necessary steps to take to receive benefits.

In contrast, while the involvement of multiple parties and the inability to modify contracts post-signature may be relevant factors in understanding the nature of contracts in general, they do not specifically characterize the conditional aspect of insurance contracts. Thus, the requirement of conditions being met for performance is the key principle that classifies insurance contracts as conditional.