CAIB 2 - Chapter 1 Questions and Answers Rated A+

CAIB 2 - Chapter 1 Questions and Answers Rated A+ The three amounts to be considered when calculating the amount of payment as outlined in the Indemnity Agreement are: 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|) Identify the four categories that buildings may fall into: Residential (ex. home) Non-mercantile (ex. hospitals, nursing homes) Mercantile (ex. drycleaners, bakeries) Manufacturing/Industrial (ex. autobody shops) Three classes of property commercially insured are: building, stock, equipment Identify the two bases that coverage can be provided on: 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 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 three conditions pertaining to the coverage for growing plants, trees, etc. - 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: 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 the three conditions that need to be present before 'similar property belonging to others' will be insured under the definition of Stock: 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 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: 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 three ways in which property may be valued: Actual Cash Value (ACV) Replacement Value Book Value