CPCU 530 STUDY GUIDE 2025
6 elements of a contract - Answers :Agreement (offer + acceptance), capacity to
contract, assent, consideration, legal purpose, made in the form required by law
Required elements of offer - Answers :Intent to contract, definite terms, communication
to offeree
Age Descrimination in Employment Act - Answers :Federal legislation that requires
employer to treat applicants and employees equally regardless of age.
Bona Fide Occupational Qualification (BFOQ) - Answers :a necessary (not merely
preferred) qualification for performing a job. Example (airline pilots or models).
Older Workers Benefit Protection Act (OWBPA) - Answers :U.S. act that amended the
Age Discrimination in Employment Act to include all employee benefits; also provided
standards that an employee's waiver of the right to sue for age discrimination must meet
in order to be upheld by a court.
Rehabilitation Act of 1973 - Answers :Extended protection to those with physical or
mental handicaps
Americans with Disabilities Act - Answers :Passed by Congress in 1991, this act banned
discrimination against the disabled in employment and mandated easy access to all
public and commerical buildings. Make reasonable accommodations.
Civil Rights Act of 1964 - Answers :outlawed discrimination based on race, color,
religion, sex, or national origin
Title 7 - Answers :prohibits employment discrimination based on race, color, religion,
sex, or national origin
Equal Pay Act - Answers :1963 law that required both men and women to receive equal
pay for equal work
Immigration Reform and Control Act of 1986 - Answers :Federal law requiring
employers to verify and maintain records on applicants' legal rights to work in the United
States
Vietnam Era Veteran's Readjustment Act of 1974 - Answers :requires federal
contractors and subcontractors to take affirmative action toward employing veterans of
the Vietnam War
Jury Systems Improvement Act of 1978 - Answers :a federal law recognizing that
participation on a jury in federal court is a protected individuals right
,Consumer Credit Protection Act - Answers :Act that limits the amount of wages that can
be garnished or withheld in any one week by an employer to satisfy creditors.
Fair Labor Standards Act - Answers :1938 act which provided for a minimum wage and
restricted shipments of goods produced with child labor. Overtime pay
Nonexempt employees - Answers :employees covered by the FLSA requirements for
overtime pay
exempt employees - Answers :Employees who are excluded from U.S. Fair Labor
Standards Act minimum wage and overtime pay requirements. (Salaried)
FMLA - Answers :12 weeks of unpaid leave (parental leave, own serious health, or care
for families conditions). Employers have 50 or more employees, for at least 20 weeks,
75 miles. For employee to be eligible, at least 12 months.
Fair Credit Reporting Act - Answers :A federal law that established procedures that
consumer-reporting agencies must follow in order to ensure that records are
confidential, accurate, relevant and properly used.
HIPPA - Answers :Health Insurance Portability and Accountability Act
Offeror - Answers :The party to a contract who promises to give something in return for
a promise or an act by another party.
Contract - Answers :A legally enforceable agreement between two or more parties.
Offeree - Answers :The party to a contract who makes a promise or acts in return for
something offered by another party.
Consideration - Answers :Something of value or bargained for and exchanged by the
parties to a contract.
Bilateral contract - Answers :A contract in which each party promises a performance.
Unilateral contract - Answers :A contract in which only one party makes a promise or
undertakes the requested performance.
Executed contract - Answers :A contract that has been completely performed by both
parties.
Executory contract - Answers :A contract that has not been completely performed by
one or both of the parties.
Express contract - Answers :A contract whose terms and intentions are explicitly stated.
, Implied contract - Answers :A contract whose terms and intentions are indicated by the
actions of the parties to the contract and the surrounding circumstances.
Uniform Commercial Code (UCC) - Answers :A model code that has been adopted in
whole or in part by each state and whose purpose is to provide a consistent legal basis
for business transactions throughout the United States and its territories.
Warranty - Answers :A written or an oral statement in a contract that certain facts are
true.
Express warranty - Answers :An explicit statement about a product by the seller that the
buyer or other user may rely on and that provides a remedy in the event the product
does not perform as claimed.
Implied warranty - Answers :An obligation that the courts impose on a seller to warrant
certain facts about a product even though not expressly stated by the seller.
Bailment - Answers :The temporary possession by one party (the bailee) of personal
property owned by another party (the bailor) for a specific purpose, such as cleaning or
repair.
Employment at will - Answers :A legal doctrine under which an employer may terminate
any employee at any time for any reason or for no reason.
Wrongful discharge - Answers :A cause of action an employee may have against an
employer for illegal termination of employment.
Bona fide occupational qualification (BFOQ) - Answers :The minimum qualification,
under federal antidiscrimination laws, that an employee needs in order to be able to
perform the duties of a particular job.
Nonexempt employee - Answers :An employee who is paid by the hour and who
receives hourly overtime pay.
Exempt employee - Answers :An employee who is paid a salary and who does not
receive overtime pay.
Conditional contract - Answers :A contract that one or more parties must perform only
under certain conditions.
Utmost good faith - Answers :An obligation to act in complete honesty and to disclose
all relevant facts
Material fact - Answers :A fact that is significant to a decision or matter at hand.
6 elements of a contract - Answers :Agreement (offer + acceptance), capacity to
contract, assent, consideration, legal purpose, made in the form required by law
Required elements of offer - Answers :Intent to contract, definite terms, communication
to offeree
Age Descrimination in Employment Act - Answers :Federal legislation that requires
employer to treat applicants and employees equally regardless of age.
Bona Fide Occupational Qualification (BFOQ) - Answers :a necessary (not merely
preferred) qualification for performing a job. Example (airline pilots or models).
Older Workers Benefit Protection Act (OWBPA) - Answers :U.S. act that amended the
Age Discrimination in Employment Act to include all employee benefits; also provided
standards that an employee's waiver of the right to sue for age discrimination must meet
in order to be upheld by a court.
Rehabilitation Act of 1973 - Answers :Extended protection to those with physical or
mental handicaps
Americans with Disabilities Act - Answers :Passed by Congress in 1991, this act banned
discrimination against the disabled in employment and mandated easy access to all
public and commerical buildings. Make reasonable accommodations.
Civil Rights Act of 1964 - Answers :outlawed discrimination based on race, color,
religion, sex, or national origin
Title 7 - Answers :prohibits employment discrimination based on race, color, religion,
sex, or national origin
Equal Pay Act - Answers :1963 law that required both men and women to receive equal
pay for equal work
Immigration Reform and Control Act of 1986 - Answers :Federal law requiring
employers to verify and maintain records on applicants' legal rights to work in the United
States
Vietnam Era Veteran's Readjustment Act of 1974 - Answers :requires federal
contractors and subcontractors to take affirmative action toward employing veterans of
the Vietnam War
Jury Systems Improvement Act of 1978 - Answers :a federal law recognizing that
participation on a jury in federal court is a protected individuals right
,Consumer Credit Protection Act - Answers :Act that limits the amount of wages that can
be garnished or withheld in any one week by an employer to satisfy creditors.
Fair Labor Standards Act - Answers :1938 act which provided for a minimum wage and
restricted shipments of goods produced with child labor. Overtime pay
Nonexempt employees - Answers :employees covered by the FLSA requirements for
overtime pay
exempt employees - Answers :Employees who are excluded from U.S. Fair Labor
Standards Act minimum wage and overtime pay requirements. (Salaried)
FMLA - Answers :12 weeks of unpaid leave (parental leave, own serious health, or care
for families conditions). Employers have 50 or more employees, for at least 20 weeks,
75 miles. For employee to be eligible, at least 12 months.
Fair Credit Reporting Act - Answers :A federal law that established procedures that
consumer-reporting agencies must follow in order to ensure that records are
confidential, accurate, relevant and properly used.
HIPPA - Answers :Health Insurance Portability and Accountability Act
Offeror - Answers :The party to a contract who promises to give something in return for
a promise or an act by another party.
Contract - Answers :A legally enforceable agreement between two or more parties.
Offeree - Answers :The party to a contract who makes a promise or acts in return for
something offered by another party.
Consideration - Answers :Something of value or bargained for and exchanged by the
parties to a contract.
Bilateral contract - Answers :A contract in which each party promises a performance.
Unilateral contract - Answers :A contract in which only one party makes a promise or
undertakes the requested performance.
Executed contract - Answers :A contract that has been completely performed by both
parties.
Executory contract - Answers :A contract that has not been completely performed by
one or both of the parties.
Express contract - Answers :A contract whose terms and intentions are explicitly stated.
, Implied contract - Answers :A contract whose terms and intentions are indicated by the
actions of the parties to the contract and the surrounding circumstances.
Uniform Commercial Code (UCC) - Answers :A model code that has been adopted in
whole or in part by each state and whose purpose is to provide a consistent legal basis
for business transactions throughout the United States and its territories.
Warranty - Answers :A written or an oral statement in a contract that certain facts are
true.
Express warranty - Answers :An explicit statement about a product by the seller that the
buyer or other user may rely on and that provides a remedy in the event the product
does not perform as claimed.
Implied warranty - Answers :An obligation that the courts impose on a seller to warrant
certain facts about a product even though not expressly stated by the seller.
Bailment - Answers :The temporary possession by one party (the bailee) of personal
property owned by another party (the bailor) for a specific purpose, such as cleaning or
repair.
Employment at will - Answers :A legal doctrine under which an employer may terminate
any employee at any time for any reason or for no reason.
Wrongful discharge - Answers :A cause of action an employee may have against an
employer for illegal termination of employment.
Bona fide occupational qualification (BFOQ) - Answers :The minimum qualification,
under federal antidiscrimination laws, that an employee needs in order to be able to
perform the duties of a particular job.
Nonexempt employee - Answers :An employee who is paid by the hour and who
receives hourly overtime pay.
Exempt employee - Answers :An employee who is paid a salary and who does not
receive overtime pay.
Conditional contract - Answers :A contract that one or more parties must perform only
under certain conditions.
Utmost good faith - Answers :An obligation to act in complete honesty and to disclose
all relevant facts
Material fact - Answers :A fact that is significant to a decision or matter at hand.
