LESSON 3 – ASSIGNMENT – PROPERTY SCENARIOS

Download Property Wordings document now.

Using the Property Scenarios document linked below, answer the following questions!! Prepare your answers in the word document worksheet below before downloading the Answer Sheet available at the foot of this lesson.

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Scenario One

Jason owns a café in rural Ontario.  He has recently landscaped the property so his café is more inviting.  He has planted some trees and shrubs around the back terrace and has started a flower garden alongside the walkway to the café door.  If they were damaged would they be covered? 

Scenario Two

Jack’s Plaques, a manufacturer of awards and trophies, has grown substantially in the past year.  Consequently, last week Jack purchased a number of laptops for use by his staff.  He spent $24,000 to buy 20 laptops.  He has yet to advise us, his insurance company, of these new laptops.  Yesterday all 20 of the laptops were stolen from the office.  Will we pay for the loss?  Why or why not?  If yes, how much will we cover?

Scenario Three

Gardener’s is a greenhouse and plant supplier.  Yesterday a car lost control and ran through the side of Gardener’s main greenhouse thereby destroying a good portion of the stock.  As it is springtime Gardener’s had received an extra shipment of flowers and shrubs last week.  Do any of the coverages  apply?  Why or why not?

Scenario Four

Coolie’s installs air conditioners in office buildings around Canada and is insured with us.  Two months ago Coolie’s installed an air conditioner at the offices of Bonanza, an event planning company.  Bonanza has been calling Coolie’s asking them to fix the leak in the air conditioner under their workmanship guarantee.  Is there an extension that will cover the damage to Bonanza’s air conditioner?  Why or why not?

Scenario Five

Keener’s, a store that sells electronic equipment, recently suffered a fire.  Keener’s has extended credit to a number of customers.  Consequently in the fire all the IOUs were burnt.  Keener’s has hired Accountants R Us to replicate the books.  When it was all said and done Accountants R Us were unable to replicate half of the IOUs and those customers are refusing to pay their IOUs.  The total of the IOUs that are not collectable by Keener’s amounts to $12,000.  Is there an extension that will cover the lost IOUs?  Why or why not?

Scenario Six

Billy’s Barnacles sells fishing equipment.  One month when he was away on a fishing trip his store was burnt to the ground.  Billy’s brother Sam was in charge of the store at the time and hired Billy’s accountant to prepare the Proof of Loss since the accountant has a better idea of Billy’s business.  When Billy gets home from his fishing trip he is greeted with a $2,500 bill from the accountant.  What section would cover this bill?  Why?

Scenario Seven

The Meringue is a little bistro in Banff.  The kitchen has an automatic built-in extinguisher above the stove.  One day last week the built-in extinguisher discharged to put out a grease fire that had started on the stove.  Jamal has been told it will cost him $3,000 to recharge the system.  Jamal is concerned because he does not have the $3,000 to recharge it.  What section would cover this bill?  Why?

Scenario Eight

One night during a major windstorm a hundred-year-old tree is blown over on to the front driveway of Trevco, a manufacturing plant, completely blocking the driveway.  The Overnighter Hotel located next to Trevco owned the tree.  In order to remove the tree Trevco had to hire a landscaping company to winch and woodchuck it.  The bill amount is $1,000.  What section would cover this bill?  Why?

Scenario Nine

A bookstore, Bindings, stores excess stock in an insured basement off-site.  There have been flood warnings for the area where the books are stored.  In order to prevent the books from being damaged Bindings hired Purolator to ship all the books to their store for 48 hours until the flooding has passed.  What section would cover the books while they are removed?  Why?

Scenario Ten –  Part I

At Laptop Express, a computer maintenance company, all the executives are required to buy a laptop to use in their day-to-day work.  Jeffery, who is one of the employees, does not have coverage for the laptop on his own insurance policy.  Therefore, when the Laptop Express building is robbed and Jeffery’s laptop is stolen he asks the owner of Laptop Express to make a claim.  What section will cover the cost to replace the laptop?  Why?

Scenario Ten – Part II

When Laptop Express was burglarized the thieves not only stole Jeffery’s laptop but they also stole the master key to the building.  The owner of Laptop Express would like to change the locks on the building.  What section would provide coverage to replace the locks?  Why?

Scenario Eleven

Bent-on Fitness has been so busy in the past year the owner, Mike, has decided to expand by purchasing a new location.  Mike has decided to design the new location to his needs specifically therefore the building must be built.  A month after construction started on Mike’s partially constructed building it is ruined by a fire.  The damages amount to $200,000.  What section would cover the loss to the building?  Why?

Scenario Twelve

The insured has a total loss fire that destroys one of their outbuildings.  This outbuilding was built close to a highway in 1967.  New by-laws state that commercial buildings have to be at least 100 feet from the centre of the highway.  Due to the by-law the outbuilding had to be built further back on the property.  This would  increase the costs to rebuild by $150,000 since a new foundation would have to be poured.  What section would cover this extra cost?  Why?

Scenario Thirteen

Foodstuffs, a large family-owned and operated grocery store, orders their produce from Greengrocers Inc.  Unfortunately the warehouses of Greengrocers Inc. were flooded last week so they have no produce to ship to Foodstuffs.  As a result Foodstuffs lost approximately $7,000 worth of business last week while they awaited new produce.  What section would cover the loss of business revenue?  Why?

Scenario Fourteen

When the power outage of August 13, 2003 occurred in Southern Ontario all the ice cream at the ice cream shop, Jen and Berry’s, melted forcing them to close the store for several days to clean up.  Jen and Berry’s lost $3,000 in sales as a result.  The power outage was due to a fire at the power generating plant.  What section would cover Jen and Berry’s loss?  Why?

Scenario Fifteen

Lago, an art gallery in Regina bought their gallery in January 2003 at which time it was insured for $150,000.  However a fire in 2004 destroyed the gallery.  The cost to rebuild the gallery in 2004 exceeded $150,000 due to the increased cost of building supplies.  What section would cover this increased cost?  Why? 

Scenario Sixteen

The Mortgage Sage has a call centre providing support for their clients who hold mortgages through them.  This call centre is on the third floor of an office building.  Last night thieves broke into the Mortgage Sage call centre and stole some computers.  The thieves gained entry to the call centre by breaking through the wall.  Where section would the damages to the wall be covered?

Once you have prepared your answers for each of the above scenarios, download this Answer Sheet and compare your answers!