Ollie applied to ProRata Insurance Company for a fire insurance policy for his warehouse. To obtain a lower premium, he misrepresents the age of the property. The policy is granted. After the ware is destroyed by fire, ProRata learns the true facts. ProRata can
a. not refuse to pay, because an application is not part of an insurance contract.
b. not refuse to pay, because fire destroyed by the warehouse.
c. refuse to pay on the ground of fraud in the application.
d. refuse to pay on the ground that fire destroyed the warehouse.
Answer: C
Business Law
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