1|Page
BC FOI – COMPREHENSIVE PRACTICE
EXAM QUESTIONS WITH VERIFIED
SOLUTIONS 2026 (A+)
Determining whether a risk meets the criteria for insurance the Underwriter must
assess the hazards that could cause a peril to occur. When checking into an
applicant's prior claims history or financial condition the Underwriter is concerned
about the existence of
a. Other parties with an insurable interest
b. Abnormal physical hazards
c. A moral hazard
d. Smoking material on the premises - correct-answer -c. A moral hazard
Property policies are designed to insure "Direct Damage" only. Two months ago a
fire caused substantial damage to an apartment building your client owns and he
was shocked when the adjuster explained that a portion of the loss would not be
paid out
,2|Page
under this policy. Which part of the loss is not covered by the property policy?
a. Damage to the building's roof caused by fire fighters' axes to dampen the fire
b. Water damage to the entire structure to halt the spread of and extinguish the
fire
c. Heat damage to the siding of the undamaged part of the building
d. Loss of rental income from the tenants who left because the building was
unsafe after the fire - correct-answer -d. Loss of rental income from the tenants
who left because the building was unsafe after the fire
All property policies contain conditions; insurers may also include warranties. The
following provisions, except one, apply to conditions and warranties. Select the
Exception:
a. A condition is a clause in a policy that requires the insured to do or not do
something
b. A warranty is a promise made by the insured that certain facts are truly as they
are represented and will remain so for the duration of the policy
c. A breach of a condition does not result in the denial of a claim so long as the
loss was not caused by such a breach
,3|Page
d. A breach of a warranty by the insured has the effect that the insurer will not
pay a claim when this breach directly caused the loss - correct-answer -d. A
breach of a warranty by the insured has the effect that the insurer will not pay a
claim when this breach directly caused the loss
Property policies exclude certain types of property. All of the following properties
are generally excluded, except one. Select the Exception:
a. Money and securities
b. A building that to the insured's knowledge has been vacant for more than 15
days
c. Automobiles and other motorized vehicles
d. Books of account - correct-answer -b. A building that to the insured's
knowledge has been vacant for more than 15 days
The following perils, except one, are also excluded under property policies. Select
the Exception:
a. Lightning, including lightning damage to electrical devices
, 4|Page
b. War and Nuclear Incident
c. Earthquake and Flood
d. Sewer Back-up - correct-answer -a. Lightning, including lightning damage to
electrical devices
Your client lost jewelry during a recent burglary and reported the loss of a
matching gold necklace with pendant and earrings. However, the insured found
one of the earrings under her bed, but she claimed the full set value. How will the
insurer settle this loss?
a. Your client will receive a payment based on the full value of the set
b. Your client will be paid for the necklace and one earring, plus 10% percent to
compensate for loss of value because the set is incomplete
c. Your client will receive a settlement for the value claimed less the value of one
earring
d. Your client will receive nothing, because her claim is fraudulent - correct-
answer -c. Your client will receive a settlement for the value claimed less the
value of one earring
BC FOI – COMPREHENSIVE PRACTICE
EXAM QUESTIONS WITH VERIFIED
SOLUTIONS 2026 (A+)
Determining whether a risk meets the criteria for insurance the Underwriter must
assess the hazards that could cause a peril to occur. When checking into an
applicant's prior claims history or financial condition the Underwriter is concerned
about the existence of
a. Other parties with an insurable interest
b. Abnormal physical hazards
c. A moral hazard
d. Smoking material on the premises - correct-answer -c. A moral hazard
Property policies are designed to insure "Direct Damage" only. Two months ago a
fire caused substantial damage to an apartment building your client owns and he
was shocked when the adjuster explained that a portion of the loss would not be
paid out
,2|Page
under this policy. Which part of the loss is not covered by the property policy?
a. Damage to the building's roof caused by fire fighters' axes to dampen the fire
b. Water damage to the entire structure to halt the spread of and extinguish the
fire
c. Heat damage to the siding of the undamaged part of the building
d. Loss of rental income from the tenants who left because the building was
unsafe after the fire - correct-answer -d. Loss of rental income from the tenants
who left because the building was unsafe after the fire
All property policies contain conditions; insurers may also include warranties. The
following provisions, except one, apply to conditions and warranties. Select the
Exception:
a. A condition is a clause in a policy that requires the insured to do or not do
something
b. A warranty is a promise made by the insured that certain facts are truly as they
are represented and will remain so for the duration of the policy
c. A breach of a condition does not result in the denial of a claim so long as the
loss was not caused by such a breach
,3|Page
d. A breach of a warranty by the insured has the effect that the insurer will not
pay a claim when this breach directly caused the loss - correct-answer -d. A
breach of a warranty by the insured has the effect that the insurer will not pay a
claim when this breach directly caused the loss
Property policies exclude certain types of property. All of the following properties
are generally excluded, except one. Select the Exception:
a. Money and securities
b. A building that to the insured's knowledge has been vacant for more than 15
days
c. Automobiles and other motorized vehicles
d. Books of account - correct-answer -b. A building that to the insured's
knowledge has been vacant for more than 15 days
The following perils, except one, are also excluded under property policies. Select
the Exception:
a. Lightning, including lightning damage to electrical devices
, 4|Page
b. War and Nuclear Incident
c. Earthquake and Flood
d. Sewer Back-up - correct-answer -a. Lightning, including lightning damage to
electrical devices
Your client lost jewelry during a recent burglary and reported the loss of a
matching gold necklace with pendant and earrings. However, the insured found
one of the earrings under her bed, but she claimed the full set value. How will the
insurer settle this loss?
a. Your client will receive a payment based on the full value of the set
b. Your client will be paid for the necklace and one earring, plus 10% percent to
compensate for loss of value because the set is incomplete
c. Your client will receive a settlement for the value claimed less the value of one
earring
d. Your client will receive nothing, because her claim is fraudulent - correct-
answer -c. Your client will receive a settlement for the value claimed less the
value of one earring
