CPCU 530 COMPREHENSIVE EXAM
REVIEW 2026 QUESTIONS WITH VERIFIED
SOLUTIONS
⩥ Implied-in-law contract. Answer: An obligation that is not an actual
contract but that is imposed by law because of the parties' conduct or
some special relationship between them or because one of them would
otherwise be unjustly enriched
⩥ Implied-in-fact contract. Answer: A contract that is not express but
that the parties presumably intended, either by tacit understanding or by
the assumption that it existed
⩥ Indemnify. Answer: To restore a party who has sustained a loss to the
same financial position that party held before the loss occurred.
⩥ Accession. Answer: An increase or addition to property.
⩥ Doctrine of stare decisis. Answer: The principle that lower courts
must follow precedents set by higher courts
⩥ Equity. Answer: Fairness, or a body of principles constituting what is
fair and right
,⩥ Criminal law. Answer: The branch of the law that imposes penalties
for wrongs against society
⩥ Substantive law. Answer: classification of law that creates, defines,
and regulates parties' rights, duties, and powers.
⩥ Procedural law. Answer: A classification of law that prescribes the
steps, or processes, for enforcing the rights and duties defined by
substantive law.
⩥ Equal Protection Clause. Answer: A part of the Fourteenth
Amendment to the U.S. Constitution prohibiting state laws that
discriminate unfairly or arbitrarily, and requiring equal treatment to all
persons under like circumstances and conditions
⩥ Arbitration. Answer: An alternative dispute resolution (ADR) method
by which disputing parties use a neutral outside party to examine the
issues and develop a settlement, which can be final and binding.
⩥ Consideration. Answer: Something of value or bargained for and
exchanged by the parties to a contract.
⩥ Third-party beneficiary. Answer: A person who is not a party to a
contract but who benefits from it and has a legal right to enforce the
contract if it is breached by either of the contracting parties.
, ⩥ Third-party beneficiary contract. Answer: A contract between two
parties that benefits a third party
⩥ Privity of contract. Answer: The relationship that exists between the
parties to a contract.
⩥ Bad faith (outrage). Answer: An intentional or reckless act, extreme or
outrageous in nature, causing severe emotional distress that results in
physical injury; generally applied in suits for breach of insurance
contracts.
⩥ Breach of contract. Answer: The failure, without legal excuse, to
fulfill a contractual promise
⩥ Consequential damages. Answer: A payment awarded by a court to
indemnify an injured party for losses that result indirectly from a wrong
such as a breach of contract or a tort.
⩥ Express waiver. Answer: A statement relinquishing a right that arose
because of a breach of contract
⩥ Tort. Answer: a wrongful act or an omission, other than a crime or a
breach of contract, that invades a legally protected right.
REVIEW 2026 QUESTIONS WITH VERIFIED
SOLUTIONS
⩥ Implied-in-law contract. Answer: An obligation that is not an actual
contract but that is imposed by law because of the parties' conduct or
some special relationship between them or because one of them would
otherwise be unjustly enriched
⩥ Implied-in-fact contract. Answer: A contract that is not express but
that the parties presumably intended, either by tacit understanding or by
the assumption that it existed
⩥ Indemnify. Answer: To restore a party who has sustained a loss to the
same financial position that party held before the loss occurred.
⩥ Accession. Answer: An increase or addition to property.
⩥ Doctrine of stare decisis. Answer: The principle that lower courts
must follow precedents set by higher courts
⩥ Equity. Answer: Fairness, or a body of principles constituting what is
fair and right
,⩥ Criminal law. Answer: The branch of the law that imposes penalties
for wrongs against society
⩥ Substantive law. Answer: classification of law that creates, defines,
and regulates parties' rights, duties, and powers.
⩥ Procedural law. Answer: A classification of law that prescribes the
steps, or processes, for enforcing the rights and duties defined by
substantive law.
⩥ Equal Protection Clause. Answer: A part of the Fourteenth
Amendment to the U.S. Constitution prohibiting state laws that
discriminate unfairly or arbitrarily, and requiring equal treatment to all
persons under like circumstances and conditions
⩥ Arbitration. Answer: An alternative dispute resolution (ADR) method
by which disputing parties use a neutral outside party to examine the
issues and develop a settlement, which can be final and binding.
⩥ Consideration. Answer: Something of value or bargained for and
exchanged by the parties to a contract.
⩥ Third-party beneficiary. Answer: A person who is not a party to a
contract but who benefits from it and has a legal right to enforce the
contract if it is breached by either of the contracting parties.
, ⩥ Third-party beneficiary contract. Answer: A contract between two
parties that benefits a third party
⩥ Privity of contract. Answer: The relationship that exists between the
parties to a contract.
⩥ Bad faith (outrage). Answer: An intentional or reckless act, extreme or
outrageous in nature, causing severe emotional distress that results in
physical injury; generally applied in suits for breach of insurance
contracts.
⩥ Breach of contract. Answer: The failure, without legal excuse, to
fulfill a contractual promise
⩥ Consequential damages. Answer: A payment awarded by a court to
indemnify an injured party for losses that result indirectly from a wrong
such as a breach of contract or a tort.
⩥ Express waiver. Answer: A statement relinquishing a right that arose
because of a breach of contract
⩥ Tort. Answer: a wrongful act or an omission, other than a crime or a
breach of contract, that invades a legally protected right.
