Registered Insurance Brokers of Ontario (RIBO) Practice Exam

Under an all risk homeowners policy, what is the coverage limit for personal property temporarily removed?

1. Up to the original purchase price

2. For a period determined by the insurance company

3. Up to the policy limit specified for personal property

4. No coverage exists for removed items

The correct answer is: Up to the policy limit specified for personal property

The correct answer is that under an all-risk homeowners policy, the coverage limit for personal property temporarily removed is up to the policy limit specified for personal property. This means that when items are temporarily removed from the premises, they are still protected under the policy, as long as the total value does not exceed the stated limit for personal property in the policy. This coverage is designed to ensure that homeowners are protected for their possessions even when they are no longer at their designated location. For example, if a homeowner takes their belongings to a storage unit during a renovation, these items are still covered up to the amount specified for personal property in the homeowners policy. The other choices do not adequately reflect how coverage applies in this context. The original purchase price is not relevant since the value of items can vary and the policy is based on the limits rather than individual purchase prices. Coverage duration is not typically specified by the insurance company; instead, it aligns with the overall terms of the policy. Lastly, claiming that no coverage exists for removed items is inaccurate, as homeowners policies generally do provide some level of protection for personal property when temporarily relocated.