CAIB 2 Full Study Guide Exam
comprehensive questions With Correct
Detailed and verified answers ACTUAL
EXAM 2026 TEST!! Graded A+ |
2026|2027 EXAM UPDATE (100%
Accurate & Verified SOLUTIONS)
Identify the two bases that coverage can be provided on: - ANSWERS-Scheduled
All property
Property of every description
Identify and give an example of each of the five types of property contained in the
definition of Building found in the IBC Commercial Property Broad Form - ANSWERS-1)
Growing plants, trees, shrubs INSIDE the building used for decorative purposes only
when insured is the owner of the building (ex. cactus)
2) Materials and equipment supplies ON the premises for maintenance (ex. lumbar,
glass)
3) Additions and extensions IN CONTACT with the building (enclosed walk-way
between buildings)
4) Permanent fittings and fixtures ATTACHED and FORMING part of the building. (ex.
light fixtures, carpeting)
5) Fixed structures PERTAINING to building and located on the premises (ex. fence)
,[GMAPF]
Identify the four categories that buildings may fall into: - ANSWERS-Residential (ex.
home)
Non-mercantile (ex. hospitals, nursing homes)
Mercantile (ex. drycleaners, bakeries)
Manufacturing/Industrial (ex. autobody shops)
The three amounts to be considered when calculating the amount of payment as
outlined in the Indemnity Agreement are: - ANSWERS-1) the value of the lost or
damaged property (ACV)
2) the interest of the insured in the property (ex. financial interest, home, mortgage)
3) the amount of insurance specified on the "Declarations Page" for the loss or
damaged property (least amount|)
Three classes of property commercially insured are: - ANSWERS-building, stock,
equipment
Identify the three conditions that need to be present before 'similar property belonging to
others' will be insured under the definition of Stock: - ANSWERS-1) must be similar to
that insured by the policy
2) the insured must have had an obligation to keep the property insured
3) the insured must be legally liable for it.
Identify the three conditions pertaining to the coverage for growing plants, trees, etc. -
ANSWERS-- such property was INSIDE the building
- was being used for decorative purposes
- insured was the owner of the building
,Identify and give an example of the three types of property contained in the definition of
Stock found in the IBC Commercial Property Broad Form: - ANSWERS-1) packing,
wrapping and advertising materials (ex. bubble plastic, Styrofoam)
2) merchandise of every description USUAL to insureds business (ex. goods for sale for
business)
3) similar property belonging to others which the insured is under obligation to keep
insured or for which he is legally liable for (appliance if appliance store.
[PMS]
Identify and give an example of each of the three types of property contained in the
definition of Equipment found in the IBC Commercial Property Broad Form: -
ANSWERS-1) generally all contents USUAL to insureds business, other than building or
stock (ex. furniture)
2) similar property belonging to others which the insured is under obligation to keep
insured or for which he is legally liable for (ex. shaw cable box)
3) tenants improvements (ex. space rented out or leased, malls)
[GST]
Identify the two types of depreciation used in the Formula/Cost Approach, and give an
example of a type of property that would be appropriate using each: - ANSWERS-
Straight Line Depreciation (ex. buildings)
&
Plateau Accelerated Depreciation (ex. cars, furniture)
A licensed real estate appraiser will generally be consulted to provide an expert opinion
when establishing Market Value/Direct Sales Approach. Identify the three items he or
she may consider: - ANSWERS-Property before the loss
Property after the loss
, the land
When is the Income Approach method most commonly employed? - ANSWERS-This
method of evaluating a loss is commonly used with income producing properties
The Broad Evidence ties together the previous four methods when establishing actual
cash value, and the courts will take into account many different factors. Identify any
three such factors: - ANSWERS-Market Value -assessed valuation
Rental Value -use of building
Location -resale success, replacement value less depreciation {any of these}
Insurers can reduce their amount of exposure on large risks by the use of Reinsurance
or Subscription polies. Outline three rules, or guidelines that apply when reinsurance is
used to provide insurance coverages: - ANSWERS-1) all insurers share premiums
collected and losses incurred
2) the policy is controlled by the primary insurer and all claims are paid by it
3) the contract is between the primary insurer and the reinsurer
Identify four instances when subscription policies may be issued: - ANSWERS-- the
broker wants to spread a good large line of business among markets
- the line of business is so SPECIALIZED, its not covered by the insurers treaty with its
reinsurers
- the type of risk is one which the insurer does not want to expose to its reinsurance
treaties
- the limits do not exceed insurers net retention limits but are beyond what it is prepared
to pay in a single claim.
comprehensive questions With Correct
Detailed and verified answers ACTUAL
EXAM 2026 TEST!! Graded A+ |
2026|2027 EXAM UPDATE (100%
Accurate & Verified SOLUTIONS)
Identify the two bases that coverage can be provided on: - ANSWERS-Scheduled
All property
Property of every description
Identify and give an example of each of the five types of property contained in the
definition of Building found in the IBC Commercial Property Broad Form - ANSWERS-1)
Growing plants, trees, shrubs INSIDE the building used for decorative purposes only
when insured is the owner of the building (ex. cactus)
2) Materials and equipment supplies ON the premises for maintenance (ex. lumbar,
glass)
3) Additions and extensions IN CONTACT with the building (enclosed walk-way
between buildings)
4) Permanent fittings and fixtures ATTACHED and FORMING part of the building. (ex.
light fixtures, carpeting)
5) Fixed structures PERTAINING to building and located on the premises (ex. fence)
,[GMAPF]
Identify the four categories that buildings may fall into: - ANSWERS-Residential (ex.
home)
Non-mercantile (ex. hospitals, nursing homes)
Mercantile (ex. drycleaners, bakeries)
Manufacturing/Industrial (ex. autobody shops)
The three amounts to be considered when calculating the amount of payment as
outlined in the Indemnity Agreement are: - ANSWERS-1) the value of the lost or
damaged property (ACV)
2) the interest of the insured in the property (ex. financial interest, home, mortgage)
3) the amount of insurance specified on the "Declarations Page" for the loss or
damaged property (least amount|)
Three classes of property commercially insured are: - ANSWERS-building, stock,
equipment
Identify the three conditions that need to be present before 'similar property belonging to
others' will be insured under the definition of Stock: - ANSWERS-1) must be similar to
that insured by the policy
2) the insured must have had an obligation to keep the property insured
3) the insured must be legally liable for it.
Identify the three conditions pertaining to the coverage for growing plants, trees, etc. -
ANSWERS-- such property was INSIDE the building
- was being used for decorative purposes
- insured was the owner of the building
,Identify and give an example of the three types of property contained in the definition of
Stock found in the IBC Commercial Property Broad Form: - ANSWERS-1) packing,
wrapping and advertising materials (ex. bubble plastic, Styrofoam)
2) merchandise of every description USUAL to insureds business (ex. goods for sale for
business)
3) similar property belonging to others which the insured is under obligation to keep
insured or for which he is legally liable for (appliance if appliance store.
[PMS]
Identify and give an example of each of the three types of property contained in the
definition of Equipment found in the IBC Commercial Property Broad Form: -
ANSWERS-1) generally all contents USUAL to insureds business, other than building or
stock (ex. furniture)
2) similar property belonging to others which the insured is under obligation to keep
insured or for which he is legally liable for (ex. shaw cable box)
3) tenants improvements (ex. space rented out or leased, malls)
[GST]
Identify the two types of depreciation used in the Formula/Cost Approach, and give an
example of a type of property that would be appropriate using each: - ANSWERS-
Straight Line Depreciation (ex. buildings)
&
Plateau Accelerated Depreciation (ex. cars, furniture)
A licensed real estate appraiser will generally be consulted to provide an expert opinion
when establishing Market Value/Direct Sales Approach. Identify the three items he or
she may consider: - ANSWERS-Property before the loss
Property after the loss
, the land
When is the Income Approach method most commonly employed? - ANSWERS-This
method of evaluating a loss is commonly used with income producing properties
The Broad Evidence ties together the previous four methods when establishing actual
cash value, and the courts will take into account many different factors. Identify any
three such factors: - ANSWERS-Market Value -assessed valuation
Rental Value -use of building
Location -resale success, replacement value less depreciation {any of these}
Insurers can reduce their amount of exposure on large risks by the use of Reinsurance
or Subscription polies. Outline three rules, or guidelines that apply when reinsurance is
used to provide insurance coverages: - ANSWERS-1) all insurers share premiums
collected and losses incurred
2) the policy is controlled by the primary insurer and all claims are paid by it
3) the contract is between the primary insurer and the reinsurer
Identify four instances when subscription policies may be issued: - ANSWERS-- the
broker wants to spread a good large line of business among markets
- the line of business is so SPECIALIZED, its not covered by the insurers treaty with its
reinsurers
- the type of risk is one which the insurer does not want to expose to its reinsurance
treaties
- the limits do not exceed insurers net retention limits but are beyond what it is prepared
to pay in a single claim.
