Which of the following statements concerning the legal requirements of insurance as a contract is (are) correct? 1. The agreement by which insurance is effected is a contract in which the insurer, in consideration of the payment of a specified sum by the policy owner, agrees to make good the losses suffered through the occurrence of a designated unfavorable contingency. 2. To be valid and enforceable, insurance contracts must meet four general legal requirements: an offer by one party and an acceptance by another party; a legal purpose or object; legal competence of both parties; and consid ation exchanged by both parties to the agreement. 1 only. 2 only. Both 1 and 2. Neither 1 nor 2. The best technique is to retain the risk because it is infrequent and low in severity if it occurs. True False