Minnesota Real Estate Exam Practice Question
After a Minnesota Standard Fire policy on a home has been in effect for 60 days, the insurance company may cancel the policy only under which of the following circumstances?
Correct Answer: C
Rationale: Cancellation of a Minnesota Standard Fire policy after 60 days is permitted primarily when the insured fails to pay the premium on time. This ensures that the insurance company can maintain financial stability and manage risk effectively.
Option A is incorrect because discontinuing coverage for a risk category does not apply to existing policies after 60 days. Option B is irrelevant; having a detached garage does not provide grounds for cancellation. Option D is also incorrect; filing a claim for a major loss cannot be used as a reason for cancellation, as it would undermine the purpose of insurance coverage.
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