Download CAIB 1 Practice Questions (100) and more Exams Insurance law in PDF only on Docsity!
CAIB 1 latest version of 2026 with verified
answers for A+
Risk - ANSWER - the chance of financial loss to which an object of insurance is exposed Speculative Risk - ANSWER - possibility of financial loss or gain Pure Risk - ANSWER - Chance of financial loss, no gain Insurance - ANSWER - undertaking by one person to indemnify another person against loss or liability for loss in respect of a certain risk or peril to which the object of insurance may be exposed or to pay a sum of money or other ting of value upon the happening of a certain event
Contract - ANSWER - an agreement between two or more persons which creates an obligation to do or not to do a particular thing Insurable Interest - ANSWER - showing you would suffer financially by a loss Utmost good faith - ANSWER - caveat emptor, buyer beware. Exercise a higher standard of honesty Indemnity - ANSWER - putting the insured back into the same position as they were in as immediately prior to loss Binder - ANSWER - Contract of insurace Agency Agreement - ANSWER - source of a brokers authority
Replacement cost - ANSWER - repair or replacement of lost or damaged property with new property of like kind and quality without depreciation Valued policy - ANSWER - insured and insurer agree on the cash value of the property at the time the policy is issued Blanket coverage - ANSWER - single limit of insurance for all property falling within specific class Scheduled coverage - ANSWER - property is itemized on the policy Fiduccary - ANSWER - someone who occupies a position of special trust or confidence in the handling or supervising of the affairs or funds of another Unearned premium - ANSWER - portion of premium that has yet to be earned
Fire - ANSWER - the presence of visible flame or glow Friendly fire - ANSWER - damaged caused to a property deliberately , no coverage Hostile fire - ANSWER - a fire that passes outside the limits assigned to it Proximate result - ANSWER - The event that actually caused the loss Material change - ANSWER - Any change within the control and knowledge of the insured that happened after the policy was issued and increases the chance of loss. Pro Rata - ANSWER - insurer divides the amount of premium paid by the number of days in the policy period.
Subrogation - ANSWER - to put into another's shoes Proprietary insurer - ANSWER - Joint stock companies owned by shareholders and seeking a profit or return on investment Non-proprietary insurer - ANSWER - organized for a reason other than profit, owned by policyholders Personal property - ANSWER - contents of the insured(s) dwelling and other personal property owned, worn, or used by the insured while on the premises which is usual to the ownership or maintenance of the dwelling Additional living expenses - ANSWER - costs "over and above" what it would normally have cost the insureds to live had the loss not occurred
Vandalism - ANSWER - wilful or ignorant destruction of property Malicious acts - ANSWER - a wrongful act that was done without legal justification or excuse Vacant - ANSWER - all occupants have moved out with no intention of returning Theft - ANSWER - all means of taking property without the owner's consent Domestic water container - ANSWER - a device or apparatus for personal use on the premise for containing, heating, chilling, or dispensing water Mobile home - ANSWER - a home which is factory built on its own chassis and which can be easily moved
Defendant - ANSWER - an individual sued by another Tort - ANSWER - a wrong done to another in breach of a duty laid out by law Strict Liability - ANSWER - Involves situations in which harm to others would result should a mishap occur. Guilty until proven guilty Negligence - ANSWER - the omission to do something a resonable person would do, or doing something which a reasonable person would not do General damages - ANSWER - made for pain and suffering Special Damages - ANSWER - Out of pocket expenses
Trespasser - ANSWER - people who are on another's premises for their own purposes without the permission of its occupier Licensee - ANSWER - one who comes on to the premises for his own purposes but with the occupiers consent. Postal worker, meter reader Invitee - ANSWER - someone who enters by invitation or with the connection to the owners business or activity the owner conducts Visitor - ANSWER - licensee and invitee are sometimes labeled as this Joint Liability - ANSWER - when two or more people act together so as to cause injury or damage
Pure no fault auto pan - ANSWER - removes the right of legal action against owners or drivers who cause injury or death to others Drivers abstract - ANSWER - lists class of driver's license, convictions or suspensions, and the date of first obtained license Threshold no fault plan - ANSWER - legal action against the responsible party is not permitted unless a certain "threshold" is exceeded, can be monetary or severity of injuries Unsatisfied judgement fund - ANSWER - indemnifies the insured when involved in an accident with an uninsured or unidentified automobile Unidentified automobile - ANSWER - cannot be found or identified, fled the scene and cannot be located
Uninsured automobile - ANSWER - neither the driver or actual owner has applicable and collectibe bodily injury liability insurance General average - ANSWER - general averaging of the amount of loss among all insurers of automobiles being transferred at the time of such loss Customs duties - ANSWER - covers repairs done to automobiles in the US that are subject to customs Temporary substitute vehicle - ANSWER - a vehicle which is temporarily being used as a substitute for the automobile described on the policy Occupant - ANSWER - someone holding, in control or inside a motor vehicle or rented premises
Insured Applicant - ANSWER - Canadian resident under 65, insured under the government health insurance plan of their province/territory of residence, who has been named on an invoice/application issued by their broker Extended family - ANSWER - dependent child, spouse, parent, guardian, brother, sister, and grandparent of the insured applicant or spouse Accident - ANSWER - an unforeseen and unintended occurrence due to external violent, sudden, fortuitous causes beyond the insured's control Sickness - ANSWER - bodily sickness of disease contracted and commencing after the policy is issued and while in effect Injury - ANSWER - bodily injury caused by an accident occurring while the insured is insured hereunder
Supervised condition - ANSWER - a diagnosed medical condition, illness, or injury for which you require any diagnostic testing, investigation, for which results are unknown and require constant consistent treatment and is controlled with medication
