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CAIB 2 Chapter 7 Practice Test 2 Quizzes & Ans!!
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CAIB 2 Chapter 7 Practice Test 2 Quizzes & Ans!!
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Name: Score:19 Multiple choice questions
Term 1 of 19
Explain the Due Diligence and Dispatch provision of the Profits forms.
Clients may be underinsured because future trends were not considered
i) Nature of business
ii) Types of perils most likely to cause losses
Everyone involved in the restoration of the business must act with due diligence
and dispatch
Only clients are required to exercise due, diligence and dispatch
Term 2 of 19
What are two factors to consider when deciding which form of business
interruption insurance to purchase?
Clients may be underinsured because future trends were not considered
i) Auditor's fees
ii) Professional fees
i) Nature of business
ii) Types of perils most likely to cause losses
i) When sales are consistent from month to month
ii) When interruption will likely be short
, Term 3 of 19
Define Contributing Properties
These are properties clients are dependent upon to supply materials or goods
There are certain businesses that cannot afford to close during reconstruction after
losses. This form pays extra expenses incurred to get back into business as soon
as possible after an insured loss.
These are properties clients rely upon to draw large numbers of customers near
their business
These are properties clients are dependent upon to purchase their goods
Term 4 of 19
When will payment be made when there has been an Interruption by Civil
Authority?
Gross Earnings and Profits forms require clients to reduce amount of business
interruption loss by more than extra expenses incurred while reducing loss.
Extra Expense forms do not limit coverage in this way.
There are certain businesses that cannot afford to close during reconstruction after
losses. This form pays extra expenses incurred to get back into business as soon
as possible after an insured loss.
This coverage is available only when there has been damage to neighbouring
premises from a peril insured under insured's policy resulting in access being
denied by civil authority
Coverage is available for two weeks when access is prohibited by order of civil
authority
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