Life & Health Insurance Practice Exam 2025 - Free Practice Questions and Study Guide

A valid contract must possess a legal characteristic that allows it to be enforceable by law. This means that the parties involved have a legal obligation to adhere to the terms specified in the contract. If one party fails to honor their commitments, the other party can seek legal recourse to enforce the agreement or claim damages. This enforceability is fundamental to the concept of contracts, ensuring that agreements made in good faith have legal standing and are respected by the judicial system.

In contrast, the other options do not align with the essential characteristics of a valid contract. While a contract can often be modified, such changes need mutual consent and do not inherently denote a legal characteristic that validates its existence. Negotiating terms is important in the context of forming a contract, but it is not a characteristic that defines its validity. Moreover, the idea that a contract can be set aside at will undermines the enforceable nature that is crucial for a contract's legitimacy. Thus, the enforceability of a contract by law is the cornerstone that confirms its legality and validity.