Washington State Insurance Practice Exam 2025 – Comprehensive All-in-One Guide to Exam Success!

Question: 1 / 400

What term describes the appearance or assumption of authority based on the actions, words, or deeds of the principal?

Apparent Authority

Apparent Authority is the term that describes the appearance or assumption of authority based on the actions, words, or deeds of the principal. This means that even though the principal did not explicitly give authority to the agent, the agent's actions may lead others to believe that the agent has the authority to act on behalf of the principal. It is important to note that Apparent Authority is based on how the principal's actions are perceived by third parties, rather than the actual authority granted to the agent by the principal.

The other options are:

- Implied Authority refers to authority that is not expressly granted but is necessary to carry out the agent's duties effectively.

- Express Authority is authority that is explicitly granted by the principal to the agent.

- Actual Authority is the authority that the principal has actually given to the agent, either expressly or impliedly.

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Implied Authority

Express Authority

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