[Information Issues] Nari Bought a Sporty, Yellow Convertible

[Information Issues] Nari bought a sporty, yellow convertible. She had a teenage son at home, Joon, but she did not plan to let him drive the new car because he had driven her last car into the lake. Embarrassed, Nari decided to change insurers. She went to Big Insurance Company to apply. She got an application from Mark, an agent. Nari was a little nervous because the application asked about other drivers in the home. It also asked if there were any teenagers in the home. Nari decided to answer "no" on both counts because she had no plans to let Joon drive. Nari got full coverage on the car, and the policy was issued shortly after she completed the application. One year later, she renewed the policy without revising any of the information she provided. One month after she renewed the policy, Nari really needed some gas in the car for the next day, but she was unable to go to the gas station. Under the belief that he had sufficiently matured, Nari sent Joon to get gas. Unfortunately, a driver who had no insurance hit the car and totaled it. (Luckily, Joon was okay.) Nari immediately called her agent, Mark. When Mark reviewed the police report, however, he told Nari that there would be no coverage on the car because Joon was driving. Nari said that was completely unfair and that she would take her case to court to be decided by a jury. Nari told Mark that Big Insurance Co. issued the policy and that she was relying on the incontestability clause. Mark told Nari that she was wrong and that based on how disputes were handled under the policy, she would not even see a jury.
-Which of the following, if any, will Big Insurance Co. most likely be required to prove in order to deny coverage based on the discrepancy between the application and Joon's driving?

A) Only that Nari's misrepresentation was material.
B) Only that the company's knowledge of the misrepresentation would have resulted in rejection of Nari's application.
C) Both that Nari's misrepresentation was material and that knowledge of the misrepresentation would have resulted in the refusal to provide insurance.
D) That Nari's misrepresentation was material; that knowledge of the misrepresentation would have resulted in rejection of her application; and that the insurer's loss would be in an amount over $10,000.
E) There is no proof that Big Insurance Co. can provide to avoid coverage because, as a matter of law, it is clear that coverage must be provided based on Joon's permissive use of the vehicle.