Insurance Fundamentals- BC
Questions and Answers (Verified)
A business may be liable for causing a Personal Injury to a Third Party. All of the
following are "Personal Injury" claims, except one. Select the one, which is not a
Personal Injury Claim.
A. Claim for a broken hip caused by the collapse of a display chair the customer sat on.
B. Claim by a tenant against the landlord for wrongful entry into the tenant's apartment.
C. Claim for false arrest by a customer, who was wrongfully detained for shoplifting.
D. Claim against a business owner by a competitor for making slanderous remarks
about his business practices. - ANSWER-A. Claim for a broken hip caused by the
collapse of a display chair the customer sat on.
A doctor's visit or hospitalization while travelling outside the provinces of Canada could
be catastrophic if there is no insurance to cover medical expenses. As a broker you
would strongly advise our clients to purchase travel insurance, which is designed to pay
all of the following expenses, except 1.
a. the cost of X-ray and other diagnostics related to an accident.
b. the cost of pre-arranged medical procedure at a health clinic abroad
c. the cost of prescription drugs
d. the cost of the air ambulance to transfer the person to a hospital in their home
province. - ANSWER-b. the cost of pre-arranged medical procedure at a health clinic
abroad
A fire totally destroyed the building owned by your client, I.M. Broke. The Actual Cash
Value of the building was $400,000. I.M. Broke still carries a mortgage of $200,000 on
his property. The building was insured for $350,000. Based on the Indemnity Agreement
what is the amount of the settlement that I.M. Broke is entitled to?
a. $400,000
b. $200,000
c. $350,000
d. $150,000 - ANSWER-d. $150,000 ($350,000 - $200,000)
A lawsuit alleging damage to a neighbouring property during excavation work was filed
against the property owner and the contractor. All of the following statements regarding
the legal liability for injury or property damage arising out of the work performed by a
contractor are true. Except one.
a. the owner will not be held legally liable if the owner hired a contractor having the
necessary expertise in performing the work
b. the owner will not be legally liable if the work is considered reasonable
c. the owner and contractor will share the liability if the work was dangerous
,d. the owner will always be held liable for injury or property damage resulting from the
work performed by the contractor. - ANSWER-d. the owner will always be held liable for
injury or property damage resulting from the work performed by the contractor.
A warranty is a:
A. Promise by the broker to remit premiums to the insurer in accordance with the terms
stated in the Agency Agreement.
B. Guarantee of insureds that certain facts are truly as they are represented to be and
that they will remain so.
C. Piece of paper similar to an Endorsement which maked changes to the policy.
D. Promise by the insurer to make payment of all claims submitted to it within a 21 day
period. - ANSWER-B. Guarantee of insureds that certain facts are truly as they are
represented to be and that they will remain so.
According to the Canadian Legal System, the Insurance Act is:
A. A part of the criminal code.
B. A precedent established by common law.
C. A part of the Civil Code.
D. A statute law. - ANSWER-D. A statute law.
Actual Cash Value means
a. The value of property at the time it was purchased
b. The re-sale value of the property
c. Replacement cost less the amount for depreciation
d. Replacement cost less the sentimental value the insured has in the property -
ANSWER-c. Replacement cost less the amount for depreciation
All commercial property insurance policies describe the classes of property insured.
Under "building" all of the following values, except one, are included. Select the value,
which is not covered under "building".
A• A large neon sign displaying the company name, which the insured erected on the
premises
B• Air conditioning units mounted on the roof of the building
C• Building materials on the insured's premises for use in the construction of a new
warehouse
D• A live palm tree surrounded by other growing plants installed in the centre of the
entrance of the insured's office building - ANSWER-C• Building materials on the
insured's premises for use in the construction of a new warehouse
All home owners forms insure the personal liability of the insured arising out of:
a. the insured's private actions anywhere in the world and business related actions in
north America only
, b. the insured's action as private citizen anywhere in the world
c. the insured's private and business actions anywhere in the world
d. the insured;s private actions in Canada and USA - ANSWER-b. the insured's action
as private citizen anywhere in the world
All Homeowners and Habitational package policies include liability insurance. Coverage
E would respond to all of the following instances, except 1.
a. bodily injury or property damage caused by the insured arising out a personal non-
business activity.
b. bodily injury suffered by a resident employee as a direct result of the insured's
negligence.
c. fire damage to a cottage rented by the insured when a burning log rolled out of a fire
place.
d. property damage to a third party resulting from the personal actions of a named
insured who does not reside at the insured premises. - ANSWER-d. property damage to
a third party resulting from the personal actions of a named insured who does not reside
at the insured premises.
All Homeowners Policies contain the section "Extensions of Coverage". All of the
following losses are covered under this section, except one. Pick the exception:
A. Damage to personal property during transportation to the insured's new principal
residence located in Sydney, Nova Scotia, which is to be occupied by the insured within
the next 10 days.
B. The cost of repair the "tear out" damage to the insured's driveway that was
necessarily caused to replace the ruptured water main.
C. The cost to replace the insured's freezer food that was spoiled as a result of a power
failure caused by lightening.
D. Loss of the insured's indoor trees and plants due to exposure to extreme
temperatures after a severe storm damaged part of the roof. - ANSWER-B. The cost of
repair the "tear out" damage to the insured's driveway that was necessarily caused to
replace the ruptured water main.
All Homeowners policies define the persons who are deemed to be an Insured. All of
the following persons are insured, except one. Pick the Exception:
A. The insured's common law spouse who has lived with the insured for five years.
B. The parents who are permanently living with the insured.
C. The insured's daughter who lives in the dorm while attending university in a
neighbouring province.
D. The tenant who occupies the basement suite in the insured's dwelling. - ANSWER-D.
The tenant who occupies the basement suite in the insured's dwelling.
All of the following automobile coverages are included in Basic Autoplan, except one.
Pick the Exception.
Questions and Answers (Verified)
A business may be liable for causing a Personal Injury to a Third Party. All of the
following are "Personal Injury" claims, except one. Select the one, which is not a
Personal Injury Claim.
A. Claim for a broken hip caused by the collapse of a display chair the customer sat on.
B. Claim by a tenant against the landlord for wrongful entry into the tenant's apartment.
C. Claim for false arrest by a customer, who was wrongfully detained for shoplifting.
D. Claim against a business owner by a competitor for making slanderous remarks
about his business practices. - ANSWER-A. Claim for a broken hip caused by the
collapse of a display chair the customer sat on.
A doctor's visit or hospitalization while travelling outside the provinces of Canada could
be catastrophic if there is no insurance to cover medical expenses. As a broker you
would strongly advise our clients to purchase travel insurance, which is designed to pay
all of the following expenses, except 1.
a. the cost of X-ray and other diagnostics related to an accident.
b. the cost of pre-arranged medical procedure at a health clinic abroad
c. the cost of prescription drugs
d. the cost of the air ambulance to transfer the person to a hospital in their home
province. - ANSWER-b. the cost of pre-arranged medical procedure at a health clinic
abroad
A fire totally destroyed the building owned by your client, I.M. Broke. The Actual Cash
Value of the building was $400,000. I.M. Broke still carries a mortgage of $200,000 on
his property. The building was insured for $350,000. Based on the Indemnity Agreement
what is the amount of the settlement that I.M. Broke is entitled to?
a. $400,000
b. $200,000
c. $350,000
d. $150,000 - ANSWER-d. $150,000 ($350,000 - $200,000)
A lawsuit alleging damage to a neighbouring property during excavation work was filed
against the property owner and the contractor. All of the following statements regarding
the legal liability for injury or property damage arising out of the work performed by a
contractor are true. Except one.
a. the owner will not be held legally liable if the owner hired a contractor having the
necessary expertise in performing the work
b. the owner will not be legally liable if the work is considered reasonable
c. the owner and contractor will share the liability if the work was dangerous
,d. the owner will always be held liable for injury or property damage resulting from the
work performed by the contractor. - ANSWER-d. the owner will always be held liable for
injury or property damage resulting from the work performed by the contractor.
A warranty is a:
A. Promise by the broker to remit premiums to the insurer in accordance with the terms
stated in the Agency Agreement.
B. Guarantee of insureds that certain facts are truly as they are represented to be and
that they will remain so.
C. Piece of paper similar to an Endorsement which maked changes to the policy.
D. Promise by the insurer to make payment of all claims submitted to it within a 21 day
period. - ANSWER-B. Guarantee of insureds that certain facts are truly as they are
represented to be and that they will remain so.
According to the Canadian Legal System, the Insurance Act is:
A. A part of the criminal code.
B. A precedent established by common law.
C. A part of the Civil Code.
D. A statute law. - ANSWER-D. A statute law.
Actual Cash Value means
a. The value of property at the time it was purchased
b. The re-sale value of the property
c. Replacement cost less the amount for depreciation
d. Replacement cost less the sentimental value the insured has in the property -
ANSWER-c. Replacement cost less the amount for depreciation
All commercial property insurance policies describe the classes of property insured.
Under "building" all of the following values, except one, are included. Select the value,
which is not covered under "building".
A• A large neon sign displaying the company name, which the insured erected on the
premises
B• Air conditioning units mounted on the roof of the building
C• Building materials on the insured's premises for use in the construction of a new
warehouse
D• A live palm tree surrounded by other growing plants installed in the centre of the
entrance of the insured's office building - ANSWER-C• Building materials on the
insured's premises for use in the construction of a new warehouse
All home owners forms insure the personal liability of the insured arising out of:
a. the insured's private actions anywhere in the world and business related actions in
north America only
, b. the insured's action as private citizen anywhere in the world
c. the insured's private and business actions anywhere in the world
d. the insured;s private actions in Canada and USA - ANSWER-b. the insured's action
as private citizen anywhere in the world
All Homeowners and Habitational package policies include liability insurance. Coverage
E would respond to all of the following instances, except 1.
a. bodily injury or property damage caused by the insured arising out a personal non-
business activity.
b. bodily injury suffered by a resident employee as a direct result of the insured's
negligence.
c. fire damage to a cottage rented by the insured when a burning log rolled out of a fire
place.
d. property damage to a third party resulting from the personal actions of a named
insured who does not reside at the insured premises. - ANSWER-d. property damage to
a third party resulting from the personal actions of a named insured who does not reside
at the insured premises.
All Homeowners Policies contain the section "Extensions of Coverage". All of the
following losses are covered under this section, except one. Pick the exception:
A. Damage to personal property during transportation to the insured's new principal
residence located in Sydney, Nova Scotia, which is to be occupied by the insured within
the next 10 days.
B. The cost of repair the "tear out" damage to the insured's driveway that was
necessarily caused to replace the ruptured water main.
C. The cost to replace the insured's freezer food that was spoiled as a result of a power
failure caused by lightening.
D. Loss of the insured's indoor trees and plants due to exposure to extreme
temperatures after a severe storm damaged part of the roof. - ANSWER-B. The cost of
repair the "tear out" damage to the insured's driveway that was necessarily caused to
replace the ruptured water main.
All Homeowners policies define the persons who are deemed to be an Insured. All of
the following persons are insured, except one. Pick the Exception:
A. The insured's common law spouse who has lived with the insured for five years.
B. The parents who are permanently living with the insured.
C. The insured's daughter who lives in the dorm while attending university in a
neighbouring province.
D. The tenant who occupies the basement suite in the insured's dwelling. - ANSWER-D.
The tenant who occupies the basement suite in the insured's dwelling.
All of the following automobile coverages are included in Basic Autoplan, except one.
Pick the Exception.
