Study 9 Flashcards
(61 cards)
What is an INSURANCE POLICY?
A LEGAL CONTRACT where the INSURER promises to INDEMNIFY the INSURED (aka “put you back where you were before the loss, but within limits—no Lamborghinis unless you had one before!”).
What does INDEMNIFY mean in insurance?
It means to put the INSURED back into the SAME FINANCIAL POSITION as before the loss. Think of it as a financial time machine, but with POLICY LIMITS. 🕰️💸
True or False: An insurance policy only applies to the insured, not the insurer.
FALSE! It’s a TWO-WAY STREET. The policy outlines the RIGHTS and DUTIES of BOTH the INSURER and the INSURED. Teamwork makes the dream work! 🤝
What do CLAUSES in an insurance policy do?
They CLARIFY the SCOPE OF COVERAGE and outline the RIGHTS and DUTIES of both parties. Think of them as the “fine print rules” of the insurance game. 📜
True or False: In British Columbia, basic coverage is provided through a policy issued by the insurer.
FALSE! In BC, BASIC COVERAGE is in the LEGISLATION, not a policy. The government’s got your back! 🏛️
What do STANDARD AUTOMOBILE INSURANCE POLICIES include?
They include CLAUSES that specify GENERAL PROVISIONS, DEFINITIONS, and EXCLUSIONS. Basically, the “rules of the road” for your car insurance. 🚗📑
True or False: Clauses in an automobile policy only apply to specific sections of the policy.
FALSE! Some clauses may apply to the ENTIRE POLICY. They’re like the “universal remote” of insurance terms. 🎮
What’s the purpose of DEFINITIONS in an auto insurance policy?
To make sure everyone’s on the SAME PAGE about what terms mean. No one wants to argue over what “accident” means after a fender bender! 🚦
True or False: Exclusions in a policy are there to give you more coverage.
FALSE! EXCLUSIONS are there to LIMIT COVERAGE. They’re like the “nope, not covering that” list. 🙅♂️
What’s the key takeaway about insurance policies?
They’re LEGAL CONTRACTS with CLAUSES that spell out who’s covered, what’s covered, and what’s NOT. Read the fine print—or at least pretend to! 📄
What’s the TERRITORY clause in an auto policy?
It means your car is covered in CANADA, the USA, or on a BOAT between them. But MEXICO? Nope—no coverage there unless you buy Mexican insurance. ¡Ay caramba! 🌮
True or False: If you drive your car into Mexico, your Canadian auto policy will cover you.
FALSE! MEXICO doesn’t recognize Canadian/US insurance. You’ll need to buy Mexican insurance or risk driving uninsured. 🚗❌
Who is considered an OCCUPANT under an auto policy?
Anyone IN, ON, or GETTING IN/OUT of the car—including the DRIVER. Even if a car DOOR smacks someone, they’re covered. Watch those swinging doors! 🚪
True or False: A passenger in a STOLEN CAR can claim compensation under the owner’s policy.
FALSE! If the car’s stolen, NO COMPENSATION for passengers. Joyriding teens, take note! 🚨
What’s the CONSENT OF OWNER clause?
If you’re in a car WITHOUT THE OWNER’S CONSENT, you’re NOT COVERED. So, no sneaky joyrides unless you want to foot the bill! 🕵️♂️
What’s a NEWLY ACQUIRED AUTOMOBILE?
A new or replacement car you buy. You get 14 DAYS of automatic coverage, but you MUST NOTIFY YOUR INSURER. Don’t forget, or you’re driving uninsured! 🚗⏰
True or False: A TEMPORARY SUBSTITUTE AUTOMOBILE (TSA) is covered for physical damage.
FALSE! A TSA is only covered for LIABILITY and ACCIDENT BENEFITS. Physical damage? That’s on the TSA owner’s policy. 🚙💥
What’s an “OTHER AUTOMOBILE” under an auto policy?
A car you BORROW (not a TSA). It’s covered if it’s a PRIVATE PASSENGER vehicle and you’re not using it for BUSINESS. So, no Uber side gigs! 🚖❌
True or False: Trailers are always covered under an auto policy.
TRUE! Trailers are covered UNLIMITEDLY, whether OWNED or BORROWED. Just don’t live in it or use it for business! 🚛
What’s the GENERAL EXCLUSIONS clause?
It lists what’s NOT COVERED, like using your car as a TAXI, carrying EXPLOSIVES, or renting it out. Want coverage? Buy an ENDORSEMENT. 💣🚕
True or False: If you’re a GARAGE WORKER fixing a car, you’re covered under the owner’s policy.
FALSE! Garage workers need their own GARAGE POLICY. The owner’s policy won’t cover you if you crash a customer’s car. 🔧🚗
What’s the WAR RISKS exclusion?
Your policy WON’T COVER losses from WAR, INVASION, or REBELLION. Because, let’s face it, insurance companies aren’t ready for World War III. 🌍💥
True or False: Carpooling is considered carrying passengers for compensation.
FALSE! CARPOOLING and sharing gas money are OK. But if you’re charging for rides, you’re in TAXI territory—and that’s excluded! 🚗💵
What’s the deal with TRAILERS in ICBC policies?
In BC, trailers need their OWN POLICY. Unlike other provinces, ICBC doesn’t extend the towing vehicle’s coverage to trailers. Trailers are high-maintenance! 🚛📑
