Canadian Accredited Insurance Broker (CAIB) Two Practice Exam

What is one unique feature of Equipment Breakdown Policies?

1. Premium rebates

2. Claims investigation services

3. Annual checks by the insurer

4. Premium reductions for claims-free years

The correct answer is: Claims investigation services

The unique feature of Equipment Breakdown Policies is their inclusion of claims investigation services. These policies are designed to cover losses resulting from the unexpected breakdown of equipment, which often requires a thorough investigation to determine the cause of the failure and the extent of the damage. The insurer typically provides claims investigation services to assess the situation accurately and ensure that the claim is handled efficiently, ensuring that all covered equipment failures are addressed correctly and promptly. In contrast, while premium rebates, annual checks by the insurer, and premium reductions for claims-free years may be features associated with other types of insurance policies or general insurance practices, they do not specifically characterize Equipment Breakdown Policies. The focus on claims investigation underscores the complexity and potential severity of equipment failures, making it a critical aspect of such coverage.