Caib 2 Test Questions
& Answers(GRADED
A+)
Scheduled Coverage - ANSWERRefer to policy on which coverage is provided only on that property
which is specifically identified or scheduled
Property of Every Description - ANSWERRefers to policy used to insure buildings, stock and
equipment under a single limit of insurance
All Property (Blanket) - ANSWERA policy which under all property owned by the insured is covered or
"blanketed" by a single limit of insurance
Tenant Improvement - ANSWERBuilding improvement, alteration and betterment made at the
expense of or purchased by the insured to a building occupied by the insured and which are
not otherwise insured, providing the insured is not the actual owner of the building
Actual Cash Value - ANSWERThe replacement or repair cost less depreciation
Replacement Value - ANSWERRepresents the cost to repair, replace or rebuild the lost of damaged
property without deduction for depreciation ( KEY DIFFERENCE - DEDUCTION WITHOUT
DEPRECIATION)
Reinsurance - ANSWERinvolves the insurer ceding of part of the risk it has assumed to one or more
other insurers (insurers sharing of the policy betw insurers)
, Subscription - ANSWERAn insurance policy under which a group of insurers has agreed to participate
in providing policy insurance coverage (brokers sharing the policy among in insurers
Conditions - ANSWERSomething imposed by the insurer which requires the insured to do or not do
something
Subrogation - ANSWERRefers to the right of the insurer to "step into the shoes" of the party whom it
has compensated and sue any party whom the compensated party could have sued
Fraudulent - ANSWERTo act willfully, and with the specific intent to deceive or cheat
Void Contract - ANSWEROne which has NO "LEGAL OR BINDING FEE" and as such, "is incapable of
being enforced bylaw"
Fire Resistive - ANSWERBuilding which have met minimum standards in terms of hours it will
withstand a specific, carefully controlled test fire
Non-Combustible - ANSWERAll structural members, including floors, roofs, and their supports are
constructed of steel, tron, concrete or other noncombustible
materials. Fall just short of fire
resistive.
Common Hazards - ANSWERconditions common to all buildings which influence their potential for
loss
Detachment - ANSWERRefers to the proximity of the building insured or containing the property
insured to other commercially rated buildings
Adverse Selection - ANSWEROccurs when the applicants for insurance are largely those most likely to
suffer a loss
& Answers(GRADED
A+)
Scheduled Coverage - ANSWERRefer to policy on which coverage is provided only on that property
which is specifically identified or scheduled
Property of Every Description - ANSWERRefers to policy used to insure buildings, stock and
equipment under a single limit of insurance
All Property (Blanket) - ANSWERA policy which under all property owned by the insured is covered or
"blanketed" by a single limit of insurance
Tenant Improvement - ANSWERBuilding improvement, alteration and betterment made at the
expense of or purchased by the insured to a building occupied by the insured and which are
not otherwise insured, providing the insured is not the actual owner of the building
Actual Cash Value - ANSWERThe replacement or repair cost less depreciation
Replacement Value - ANSWERRepresents the cost to repair, replace or rebuild the lost of damaged
property without deduction for depreciation ( KEY DIFFERENCE - DEDUCTION WITHOUT
DEPRECIATION)
Reinsurance - ANSWERinvolves the insurer ceding of part of the risk it has assumed to one or more
other insurers (insurers sharing of the policy betw insurers)
, Subscription - ANSWERAn insurance policy under which a group of insurers has agreed to participate
in providing policy insurance coverage (brokers sharing the policy among in insurers
Conditions - ANSWERSomething imposed by the insurer which requires the insured to do or not do
something
Subrogation - ANSWERRefers to the right of the insurer to "step into the shoes" of the party whom it
has compensated and sue any party whom the compensated party could have sued
Fraudulent - ANSWERTo act willfully, and with the specific intent to deceive or cheat
Void Contract - ANSWEROne which has NO "LEGAL OR BINDING FEE" and as such, "is incapable of
being enforced bylaw"
Fire Resistive - ANSWERBuilding which have met minimum standards in terms of hours it will
withstand a specific, carefully controlled test fire
Non-Combustible - ANSWERAll structural members, including floors, roofs, and their supports are
constructed of steel, tron, concrete or other noncombustible
materials. Fall just short of fire
resistive.
Common Hazards - ANSWERconditions common to all buildings which influence their potential for
loss
Detachment - ANSWERRefers to the proximity of the building insured or containing the property
insured to other commercially rated buildings
Adverse Selection - ANSWEROccurs when the applicants for insurance are largely those most likely to
suffer a loss
