Registered Insurance Brokers of Ontario (RIBO) Practice Exam

In property insurance policies, statutory conditions are specific provisions mandated by the Insurance Act that provide a basic framework for the rights and obligations of both the insurer and the insured. These conditions generally cover essential aspects such as the insured's responsibilities, the handling of claims, and conditions under which coverage may apply or may be denied.

The subject of perils covered by the policy typically falls within the definition and terms of the coverage rather than the statutory conditions themselves. Perils, which define the risks that the policy will cover (such as fire, theft, or specific damages), are detailed in the policy wording but do not qualify as statutory conditions—these are more about the procedural and regulatory aspects of the contract.

In contrast, policy limits, claim procedures, and descriptions of insured property are all elements that can fall under statutory conditions. These ensure that policyholders know the maximum liability of the insurer, the process to follow in case of a claim, and exactly what properties are covered under the policy.

Understanding the distinction between what constitutes statutory conditions and other policy elements helps in conforming to regulatory requirements and ensuring clarity between the insurer and insured regarding coverage specifics and procedural expectations.