FUNDAMENTALS OF INSURANCE (BC) QUESTIONS WITH
VERIFIED ANSWERS 2025 NEWEST VERSION 100% PASS
Under the policy of "fire" insurance, the insurer would be obligated to pay the following
loss only:
A. Fire damage caused to appliance following a sudden power surge.
B. Fire damage to insured buildings occurring during a rebellion.
C. Damage to insured property due to radioactive contamination.
D. Loss of property caused by a process involving the application of heat.
B. Fire damage to insured buildings occurring during a rebellion.
Generally, all of the following, except one, are seen to be "incompetent" or lacking the
legal capacity to contract. Pick the exception:
A. A corporation.
B. A child.
C. A trade name.
D. A senile person.
A. A corporation.
If a burning log rolls out of your clients fireplace grate across the hearth and onto the rug
in front, the loss to the rug is considered to be the result of a(n):
A. Direct fire.
B. Indirect fire
C. Friendly fire
D. Hostile fire
D. Hostile fire
,Statutory Condition Five: Termination, sets out the provisions for cancellation of a
contract of insurance that must be compiled with by the insured and the insurer. All of the
following provisions regarding termination by the insurer are true, except one. Select the
exception:
A. When written notice of the termination is sent by registered mail, the insurer must give
the insured 15 days' notice starting the day after the letter is received by the insured's
post office.
B. When written notice of termination is sent hand-delivered, the insurer must give the
insured 15 days' notice starting on the date the letter was registered by the insurer's post
office.
C. When written notice of termination is sent hand delivered, the insurer must give the
insured 5 days' notice.
D. When the insured is entitled to a premium refund, the amount of the refund is
calculated on pro- rate (per diem) basis.
B. When written notice of termination is sent hand-delivered, the insurer must give the
insured 15 days' notice starting on the date the letter was registered by the insurer's post
office.
The Insurance Act provides that a Waiver of Term or Condition of an insurance contract is:
A. Permitted to be made by the insurance broker as long as it is in favour of the insured.
B. Not binding, unless it is in writing and under the signature of a person authorized by the
insurer.
C. Valid only when signed by both the insurer and the insured.
D. Bonding when even provided orally.
B. Not binding, unless it is in writing and under the signature of a person authorized by the
insurer.
One of the elements that determines whether a contact is legally enforceable or not is the
"legal capacity of the parties". In all of the following contracts, except one, are the parties
considered to have "legal capacity". Select the one that does not meet this element.
,A. An insurance contract issued in the name of Marry Poppin d.b.a. Little People Day Care
Centre.
B. A lease agreement naming the tenant as the "No Risk Denied Insurance Corporation".
C. A building contract showing the General Contractor as Bricks and Mortar Inc.
D. An invoice for merchandise shipped to the order of Mandy's Souvenir and Gift Shop.
D. An invoice for merchandise shipped to the order of Mandy's Souvenir and Gift Shop.
Risk selection is based on the Underwriter's assessment of the hazards pertaining to the
risk that has been submitted for insurance. An underwriter must determine whether or
not there is a potential Moral Hazard. The following does not apply as a condition
indicating the presence of a Moral Hazard:
A. The moral character of the applicant for insurance.
B. The financial condition of the applicant for insurance.
C. The physical condition of the premises which may cause a loss to occur.
D. The indifference to loss of the applicant for insurance.
C. The physical condition of the premises which may cause a loss to occur.
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.
B. Guarantee of insureds that certain facts are truly as they are represented to be and that
they will remain so.
, 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.
B. The cost of repair the "tear out" damage to the insured's driveway that was necessarily
caused to replace the ruptured water main.
The Basis of Claim Payment is the same for all Homeowners Forms. All of these
statements regarding the Basis of Claim Payment are true, except one. Pick the
EXCEPTION:
A. Dwelling Building and Detached Private Structures are covered on a Replacement Cost
Basis.
B. Personal Property is insured for Replacement Cost except electronic media and books
of account, which are subject to a special basis of settlement.
C. Artwork, antiques, memorabilia, and souvenirs are covered on Actual Cash Value Basis.
D. Dwelling Building and Detached Private Structures are covered on a Replacement Cost
Basis, which includes any increased cost of construction to the enforcement of by-laws.
D. Dwelling Building and Detached Private Structures are covered on a Replacement Cost
Basis, which includes any increased cost of construction to the enforcement of by-laws.
Under all Homeowners Forms, the coverage for certain Personal Property articles is
restricted to "Special Limits Of Insurance", unless the insured has purchased additional
insurance. All of the following objects are subject to "Special Limits," except one. Pick the
VERIFIED ANSWERS 2025 NEWEST VERSION 100% PASS
Under the policy of "fire" insurance, the insurer would be obligated to pay the following
loss only:
A. Fire damage caused to appliance following a sudden power surge.
B. Fire damage to insured buildings occurring during a rebellion.
C. Damage to insured property due to radioactive contamination.
D. Loss of property caused by a process involving the application of heat.
B. Fire damage to insured buildings occurring during a rebellion.
Generally, all of the following, except one, are seen to be "incompetent" or lacking the
legal capacity to contract. Pick the exception:
A. A corporation.
B. A child.
C. A trade name.
D. A senile person.
A. A corporation.
If a burning log rolls out of your clients fireplace grate across the hearth and onto the rug
in front, the loss to the rug is considered to be the result of a(n):
A. Direct fire.
B. Indirect fire
C. Friendly fire
D. Hostile fire
D. Hostile fire
,Statutory Condition Five: Termination, sets out the provisions for cancellation of a
contract of insurance that must be compiled with by the insured and the insurer. All of the
following provisions regarding termination by the insurer are true, except one. Select the
exception:
A. When written notice of the termination is sent by registered mail, the insurer must give
the insured 15 days' notice starting the day after the letter is received by the insured's
post office.
B. When written notice of termination is sent hand-delivered, the insurer must give the
insured 15 days' notice starting on the date the letter was registered by the insurer's post
office.
C. When written notice of termination is sent hand delivered, the insurer must give the
insured 5 days' notice.
D. When the insured is entitled to a premium refund, the amount of the refund is
calculated on pro- rate (per diem) basis.
B. When written notice of termination is sent hand-delivered, the insurer must give the
insured 15 days' notice starting on the date the letter was registered by the insurer's post
office.
The Insurance Act provides that a Waiver of Term or Condition of an insurance contract is:
A. Permitted to be made by the insurance broker as long as it is in favour of the insured.
B. Not binding, unless it is in writing and under the signature of a person authorized by the
insurer.
C. Valid only when signed by both the insurer and the insured.
D. Bonding when even provided orally.
B. Not binding, unless it is in writing and under the signature of a person authorized by the
insurer.
One of the elements that determines whether a contact is legally enforceable or not is the
"legal capacity of the parties". In all of the following contracts, except one, are the parties
considered to have "legal capacity". Select the one that does not meet this element.
,A. An insurance contract issued in the name of Marry Poppin d.b.a. Little People Day Care
Centre.
B. A lease agreement naming the tenant as the "No Risk Denied Insurance Corporation".
C. A building contract showing the General Contractor as Bricks and Mortar Inc.
D. An invoice for merchandise shipped to the order of Mandy's Souvenir and Gift Shop.
D. An invoice for merchandise shipped to the order of Mandy's Souvenir and Gift Shop.
Risk selection is based on the Underwriter's assessment of the hazards pertaining to the
risk that has been submitted for insurance. An underwriter must determine whether or
not there is a potential Moral Hazard. The following does not apply as a condition
indicating the presence of a Moral Hazard:
A. The moral character of the applicant for insurance.
B. The financial condition of the applicant for insurance.
C. The physical condition of the premises which may cause a loss to occur.
D. The indifference to loss of the applicant for insurance.
C. The physical condition of the premises which may cause a loss to occur.
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.
B. Guarantee of insureds that certain facts are truly as they are represented to be and that
they will remain so.
, 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.
B. The cost of repair the "tear out" damage to the insured's driveway that was necessarily
caused to replace the ruptured water main.
The Basis of Claim Payment is the same for all Homeowners Forms. All of these
statements regarding the Basis of Claim Payment are true, except one. Pick the
EXCEPTION:
A. Dwelling Building and Detached Private Structures are covered on a Replacement Cost
Basis.
B. Personal Property is insured for Replacement Cost except electronic media and books
of account, which are subject to a special basis of settlement.
C. Artwork, antiques, memorabilia, and souvenirs are covered on Actual Cash Value Basis.
D. Dwelling Building and Detached Private Structures are covered on a Replacement Cost
Basis, which includes any increased cost of construction to the enforcement of by-laws.
D. Dwelling Building and Detached Private Structures are covered on a Replacement Cost
Basis, which includes any increased cost of construction to the enforcement of by-laws.
Under all Homeowners Forms, the coverage for certain Personal Property articles is
restricted to "Special Limits Of Insurance", unless the insured has purchased additional
insurance. All of the following objects are subject to "Special Limits," except one. Pick the
