Registered Insurance Brokers of Ontario (RIBO) Practice Exam

When there has been an auto loss, what is the requirement for the insured?

1. Notify the authorities immediately

2. Protect the automobile from further loss within 90 days

3. Arrange for a rental vehicle

4. File a claim within 24 hours

The correct answer is: Protect the automobile from further loss within 90 days

The correct answer is that the insured is required to protect the automobile from further loss within a specified timeframe, typically stated in insurance policies. This requirement is crucial because it emphasizes the responsibility of the insured to mitigate any additional damage or loss after the initial incident has occurred. For example, if the vehicle is damaged in an accident, the insured should take steps to safeguard it from additional harm, whether that means securing the vehicle or obtaining necessary repairs promptly. Taking proactive measures not only helps preserve the condition of the automobile but also demonstrates the insured's commitment to minimizing the insurer's potential liabilities. Insurance policies often include clauses that may limit coverage if the insured fails to take reasonable steps to prevent further damage after a loss. The other choices might have relevance in certain contexts but do not reflect the primary obligation outlined in most automobile insurance policies. Notifying authorities is often important for legal reasons but isn't typically a requirement of the insurance contract itself. While arranging for a rental vehicle may be a practical step, it is not mandated by insurance policies. Lastly, filing a claim within a specified timeframe can vary by insurer, and while prompt reporting is advantageous, there is generally no universal 24-hour requirement across all policies.