RIBO TEST #3 HOME INSURANCE
QUESTIONS AND ANSWERS
In the Homeowners Comprehensive Policy, there are Extensions of Coverage provided.
Which of the following extensions increase the amount of insurance?
a. Tear Out
b. Moving to Another Home Incorrect
c. Arson Conviction Reward
d. Lock Replacement - Correct Answers -Arson Conviction Reward
Which of the following statements is CORRECT about the Highway Victims Indemnity
Fund? - Correct Answers -It will not pay if the claimant is totally responsible for causing
the accident.
To cover costs for a business to lease a new location to continue business after an
insured loss, the business will require which of the following?
a. Profits coverage
b. Extra Expense coverage
c. Extended Business Profit endorsement Incorrect
d. Gross Earnings coverage - Correct Answers -Extra Expense coverage
The insured leaves a tavern, gets into his auto in an intoxicated state, and causes an
accident on the way home. Which of the following would NOT be covered?
Select one:
a. Collision damage to his automobile
b. Damage to a telephone pole
c. Damage to another automobile
d. Medical and surgical expenses required as a result of injuries he sustains Incorrect
Feedback - Correct Answers -Collision damage to his automobile
Brokers may bind risks in accordance with the terms of their company-broker
agreements. Which of the following statements is CORRECT?
a. Binders may be oral or written.
b. Binders only become effective after a premium is paid for them. Incorrect
c. All binders expire automatically seven days after their effective date.
d. Only written binders are legal. - Correct Answers -Binders may be oral or written.
Under Third Party Liability coverage, the definition of "insured person" is
, Select one:
a. anyone who personally drives the insured automobile with consent.
b. anyone who personally operates any part of the insured automobile with consent.
c. the named insured. Incorrect
d. All of the above - Correct Answers -d.all above
Your insured owns two secondary residences on the same property and rents one out
for $500 per month. A windstorm totally destroys the rental residence and it will take five
months to rebuild the dwelling. The Secondary Policy covers the building for $100,000
subject to a $500 deductible. How much would the insured collect under the Rental
Value section of the Secondary Policy in addition to the total loss of the dwelling?
a. $2,500
b. $2,000 Incorrect
c. Nothing, as the Rental Value section is included in the policy limit
d. $500 - Correct Answers -Nothing, as the Rental Value section is included in the policy
limit
Common law?
a. It is the expressed will of the common people governing relationships among all
members of society regardless of their status.
b. It is a body of well-defined legal principles set out in thousands of court decisions
over hundreds of years.
c. It is the written law upon which judges make their decisions without being bound by
what other judges have done in the past. Incorrect
d. It is a written or codified law in the form of acts or statutes created by acts of the
federal and provincial legislatures. - Correct Answers -It is a body of well-defined legal
principles set out in thousands of court decisions over hundreds of years.
An independent agent or broker must maintain a trust account
a. into which all commission amounts are transferred.
b. from which all business expenses are paid.
c. from which net premiums are paid to insurers.
d. into which amounts are transferred to meet emergencies. Incorrect
Feedback - Correct Answers -from which net premiums are paid to insurers.
In Section 2 Liability Coverage of the Homeowners Comprehensive Policy, coverage is
provided for Voluntary Payment for Damage to Property in which of the following
situations?
Select one:
a. Property of others damaged intentionally by the insured's 10-year-old son, for which
he is not legally liable.
b. Damage to a ride-on lawnmower rented from a local rental establishment.
c. Damage caused by a guest, who backed an automobile into a portable barbeque
which the insured had borrowed from a neighbour. Incorrect
QUESTIONS AND ANSWERS
In the Homeowners Comprehensive Policy, there are Extensions of Coverage provided.
Which of the following extensions increase the amount of insurance?
a. Tear Out
b. Moving to Another Home Incorrect
c. Arson Conviction Reward
d. Lock Replacement - Correct Answers -Arson Conviction Reward
Which of the following statements is CORRECT about the Highway Victims Indemnity
Fund? - Correct Answers -It will not pay if the claimant is totally responsible for causing
the accident.
To cover costs for a business to lease a new location to continue business after an
insured loss, the business will require which of the following?
a. Profits coverage
b. Extra Expense coverage
c. Extended Business Profit endorsement Incorrect
d. Gross Earnings coverage - Correct Answers -Extra Expense coverage
The insured leaves a tavern, gets into his auto in an intoxicated state, and causes an
accident on the way home. Which of the following would NOT be covered?
Select one:
a. Collision damage to his automobile
b. Damage to a telephone pole
c. Damage to another automobile
d. Medical and surgical expenses required as a result of injuries he sustains Incorrect
Feedback - Correct Answers -Collision damage to his automobile
Brokers may bind risks in accordance with the terms of their company-broker
agreements. Which of the following statements is CORRECT?
a. Binders may be oral or written.
b. Binders only become effective after a premium is paid for them. Incorrect
c. All binders expire automatically seven days after their effective date.
d. Only written binders are legal. - Correct Answers -Binders may be oral or written.
Under Third Party Liability coverage, the definition of "insured person" is
, Select one:
a. anyone who personally drives the insured automobile with consent.
b. anyone who personally operates any part of the insured automobile with consent.
c. the named insured. Incorrect
d. All of the above - Correct Answers -d.all above
Your insured owns two secondary residences on the same property and rents one out
for $500 per month. A windstorm totally destroys the rental residence and it will take five
months to rebuild the dwelling. The Secondary Policy covers the building for $100,000
subject to a $500 deductible. How much would the insured collect under the Rental
Value section of the Secondary Policy in addition to the total loss of the dwelling?
a. $2,500
b. $2,000 Incorrect
c. Nothing, as the Rental Value section is included in the policy limit
d. $500 - Correct Answers -Nothing, as the Rental Value section is included in the policy
limit
Common law?
a. It is the expressed will of the common people governing relationships among all
members of society regardless of their status.
b. It is a body of well-defined legal principles set out in thousands of court decisions
over hundreds of years.
c. It is the written law upon which judges make their decisions without being bound by
what other judges have done in the past. Incorrect
d. It is a written or codified law in the form of acts or statutes created by acts of the
federal and provincial legislatures. - Correct Answers -It is a body of well-defined legal
principles set out in thousands of court decisions over hundreds of years.
An independent agent or broker must maintain a trust account
a. into which all commission amounts are transferred.
b. from which all business expenses are paid.
c. from which net premiums are paid to insurers.
d. into which amounts are transferred to meet emergencies. Incorrect
Feedback - Correct Answers -from which net premiums are paid to insurers.
In Section 2 Liability Coverage of the Homeowners Comprehensive Policy, coverage is
provided for Voluntary Payment for Damage to Property in which of the following
situations?
Select one:
a. Property of others damaged intentionally by the insured's 10-year-old son, for which
he is not legally liable.
b. Damage to a ride-on lawnmower rented from a local rental establishment.
c. Damage caused by a guest, who backed an automobile into a portable barbeque
which the insured had borrowed from a neighbour. Incorrect
