CAIB 3 Practice Exam Questions with Answers
Civil Law - ✔✔concerned with civil or private rights originating from tort law or contract law
Trespass - ✔✔an unlawful interference with the person, property, or rights of another
Occupier - ✔✔Someone who has some degree of control over land or buildings on that land.
They can exclude or admit entry of others
Malicious Prosecution - ✔✔where the compliant is arrested and released and evidence shows
the person making the complaint did not have an honest belief that a crime was committed-
rather was guided by other improper motives
Particular Average - ✔✔a partial loss to a specific shipment
Obligee - ✔✔the party to whom someone else is obligated under a contract
Working capital - ✔✔the amount of funds available to pay continuing buisness operating
expenses until payment is received for work being undertaken by the contractor (current
assets-current liabilities)
Risk Control - ✔✔methods taken to reduce the frequency and severity of losses as much as
possible with the resources available
Going concern value - ✔✔The difference in the value of property which must be sold after a
loss and its value had the business continued
What does CGL consider as bodily injury? - ✔✔Physical injury to the body
sickness & disease
, death as a result from injuries, sickness or disease
Piece of legislation that outlines responsibilities of sellers to buyers - ✔✔Sales of Goods Act
3 duties manufacturers to users of their products - ✔✔safe design, manufacture, construction,
assembly, packaging
provide adequate warning of dangers
produce adequate instructions
With respect to premium chargered for product liability exposures, what are 3 influencing
factors? - ✔✔Types of products sold
volume of sales
territory of sales
3 components of the transit clause - ✔✔- coverage ceases when goods have been offloaded but
not delivered within 60 days of being offloaded
- coverage ceases when the goods are diverted to a destination not indicated on the policy, but
within the control of the insured
- goods are insured when diverted or delayed beyond the control of the client
Forwarding Charges Clause
(discharging shipments at ports not covered may cause insureds to incur additional expenses) -
✔✔- unloading expenses
- storing expenses
- expenses to forward goods to the destination to which insurance applies.
2 types of total losses the cargo policy may cover - ✔✔- Actual total loss- where shipment has
no value (ex/boat sinks)
- COnstructive Total Loss- where the cost of salvage is too high relative to the value saved
Civil Law - ✔✔concerned with civil or private rights originating from tort law or contract law
Trespass - ✔✔an unlawful interference with the person, property, or rights of another
Occupier - ✔✔Someone who has some degree of control over land or buildings on that land.
They can exclude or admit entry of others
Malicious Prosecution - ✔✔where the compliant is arrested and released and evidence shows
the person making the complaint did not have an honest belief that a crime was committed-
rather was guided by other improper motives
Particular Average - ✔✔a partial loss to a specific shipment
Obligee - ✔✔the party to whom someone else is obligated under a contract
Working capital - ✔✔the amount of funds available to pay continuing buisness operating
expenses until payment is received for work being undertaken by the contractor (current
assets-current liabilities)
Risk Control - ✔✔methods taken to reduce the frequency and severity of losses as much as
possible with the resources available
Going concern value - ✔✔The difference in the value of property which must be sold after a
loss and its value had the business continued
What does CGL consider as bodily injury? - ✔✔Physical injury to the body
sickness & disease
, death as a result from injuries, sickness or disease
Piece of legislation that outlines responsibilities of sellers to buyers - ✔✔Sales of Goods Act
3 duties manufacturers to users of their products - ✔✔safe design, manufacture, construction,
assembly, packaging
provide adequate warning of dangers
produce adequate instructions
With respect to premium chargered for product liability exposures, what are 3 influencing
factors? - ✔✔Types of products sold
volume of sales
territory of sales
3 components of the transit clause - ✔✔- coverage ceases when goods have been offloaded but
not delivered within 60 days of being offloaded
- coverage ceases when the goods are diverted to a destination not indicated on the policy, but
within the control of the insured
- goods are insured when diverted or delayed beyond the control of the client
Forwarding Charges Clause
(discharging shipments at ports not covered may cause insureds to incur additional expenses) -
✔✔- unloading expenses
- storing expenses
- expenses to forward goods to the destination to which insurance applies.
2 types of total losses the cargo policy may cover - ✔✔- Actual total loss- where shipment has
no value (ex/boat sinks)
- COnstructive Total Loss- where the cost of salvage is too high relative to the value saved
