Canadian Accredited Insurance Broker (CAIB) One Practice Exam

What responsibilities does an insured have under the property protection systems clause?

1. Notify the insurer after claims are made

2. Notify the insurer immediately of any monitoring lapses

3. Ensure the property is always occupied

4. Maintain a record of all covered items

The correct answer is: Notify the insurer immediately of any monitoring lapses

The responsibilities of an insured under the property protection systems clause primarily revolve around maintaining the integrity of the protective measures in place, which includes monitoring systems such as alarms or surveillance. Ensuring that the insurer is immediately notified of any monitoring lapses is crucial because these lapses can significantly increase the risk of a loss occurring. If the monitoring system is not operational, the insured may not be protected in the event of theft, vandalism, or other incidents that the protection system is designed to prevent. Timely notification about monitoring issues allows the insurer to assess the situation and make informed decisions regarding coverage and claims. This responsibility underscores the importance of the insured's proactive engagement in safeguarding the property and adhering to the conditions laid out in their insurance policy. In contrast, simply notifying the insurer after claims are made does not fulfill the insurance contract's expectations regarding risk management. Ensuring that the property is always occupied is not a requirement under this clause, as occupancy may not necessarily relate to the operation of monitoring systems. Maintaining a record of all covered items is good practice but doesn't directly pertain to the monitoring systems condition outlined in the property protection systems clause.