Free CII Commercial Property and Business Interruption Insurances MCQ Examination (E93) Practice Questions

Sample Practice Questions

Try these 10 sample questions from the CII Commercial Property and Business Interruption Insurances MCQ Examination (E93) practice bank. Each includes the answer and explanation. Continue with the interactive practice above to review the full question set.

1. 1Which feature of an electrical appliance can create an ignition hazard through overheating?

   1. A.Blocked ventilation openingsCorrect answer: A
   2. B.An intact protective casing
   3. C.A correctly rated supply cable
   4. D.A clear ventilation grille

   Explanation: The guidance states, "allowing ventilation points to become clogged or blocked, causing overheating;". Blocked ventilation retains heat; the other descriptions do not introduce the stated overheating mechanism.

   Reference: UK Government Fire Safety Risk Assessment: Offices and Shops — Part 2, 1.4

2. 2In property insurance, what is the essential distinction between an all-risks insuring clause and a promise to cover every loss?

   1. A.All-risks cover removes every exclusion from the policy
   2. B.All-risks cover pays every accounting loss without damage
   3. C.All-risks cover automatically insures every unscheduled location
   4. D.All-risks cover remains subject to exclusions and conditionsCorrect answer: D

   Explanation: The property wording states, "The Insurer will pay the Insured for Damage to Property Insured at the Premises shown in the Schedule, excluding". The wording covers damage to insured property at scheduled premises subject to exclusions. The label does not eliminate boundaries.

   Reference: Allianz Property Damage All Risks Section FJ0017_2 — Cover, p. 3

3. 3What period does a damage-based business-interruption indemnity period cover?

   1. A.The annual policy period regardless of disruption
   2. B.Only the time firefighters remain at the premises
   3. C.Only the time before physical repairs begin
   4. D.The period business results are affected, limited by the maximumCorrect answer: D

   Explanation: The source states, "The period beginning with the occurrence of the Event and ending not later than the Maximum Indemnity Period thereafter during which the results of the Business shall be affected in consequence of any Event.". It starts with the event and follows its effect on results, up to the maximum period.

   Reference: Allianz BI All Risks Estimated Gross Profit FR0113_1 — Definitions: Indemnity Period, p. 1

4. 4What is a principal underwriting use of a property risk survey report?

   1. A.Establish only the current sale value of the property
   2. B.Assess the level of physical risk presentedCorrect answer: B
   3. C.Determine only whether a claim has already been paid
   4. D.Replace inspection findings with the declared sum insured

   Explanation: The source states, "relevant to an underwriter making an assessment of the level of risk". The report supplies risk information for underwriting, not tax, investment certification or a substitute contract.

   Reference: IMIA Risk Engineering in Major Construction Projects GP27 — Section 11, p. 13

5. 5Why can a BI insurer request books of account, vouchers and invoices when adjusting a claim?

   1. A.To assume reported turnover is the same as insured loss
   2. B.To treat all expenditure in the accounts as recoverable
   3. C.To establish a claim without checking causation or policy terms
   4. D.To investigate and verify the claimed trading lossCorrect answer: D

   Explanation: The source states, "for the purpose of investigating or verifying". Records substantiate the amount and cause of loss. They do not create cover for every shortfall or guarantee future results.

   Reference: Allianz BI All Risks Estimated Gross Profit FR0113_1 — Additional Claims Conditions, p. 14

6. 6Why can waste packaging left beside a heat source increase the chance of a fire starting?

   1. A.It mainly increases the supply of oxygen
   2. B.It mainly creates an electrical current
   3. C.It mainly reduces the source's temperature
   4. D.It brings combustible fuel close to ignitionCorrect answer: D

   Explanation: The guidance states, "waste packaging is allowed to accumulate near to a heat source". The waste provides fuel next to heat; it does not isolate electricity, deplete oxygen or provide cooling.

   Reference: UK Government Fire Safety Risk Assessment: Offices and Shops — Part 1, 3.1

7. 7Under a property policy whose Buildings definition includes landlord's fixtures, which item belongs under Buildings rather than a tenant's movable contents?

   1. A.A tenant's cartons of finished stock
   2. B.A tenant's freestanding office chairs
   3. C.A landlord's fixed sanitary fittingCorrect answer: C
   4. D.A tenant's movable packing machine

   Explanation: The property wording states, "landlord’s fixtures and fittings, fixed glass and fixed sanitary ware in or on or pertaining to the buildings". Landlord's fixed fittings form part of the Buildings definition; movable business contents and stock are different categories.

   Reference: Allianz Property Damage All Risks Section FJ0017_2 — Section Definitions: Buildings, p. 1

8. 8Why does a gross-profit BI policy specify uninsured working expenses?

   1. A.To equate insured gross profit with turnover
   2. B.To exclude all standing charges automatically
   3. C.To deduct specified expenses when calculating insured gross profitCorrect answer: C
   4. D.To add every specified expense to gross profit

   Explanation: The policy defines gross profit as "The amount by which the sum of the amount of the Turnover and the amount of the closing stock and work in progress shall exceed the amount of the opening stock and work in progress and the amount of the Uninsured Working Expenses.". Specified uninsured working expenses are deducted when calculating the insured gross-profit amount; they are not added back and the calculation is not simply total turnover or exclusion of all standing charges.

   Reference: Allianz BI All Risks Estimated Gross Profit FR0113_1 — Definitions: Gross Profit, p. 1

9. 9Why should a surveyor check actual site practices even when the business holds management-system certification?

   1. A.Site application of standards may differ from documentationCorrect answer: A
   2. B.Certification proves all physical controls are operational
   3. C.Certification fixes the maximum loss at zero
   4. D.Certification removes any need to inspect hazards

   Explanation: The source states, "Application at a site level can be patchy". Document-based certification does not establish actual implementation, zero loss or absence of hazards.

   Reference: IMIA Risk Engineering in Major Construction Projects GP27 — Section 10, p. 13

10. 10What is the role of subrogation following an insured property-related loss?

    1. A.Create a second full indemnity payable to the insured
    2. B.Allocate the insured loss between insurers covering the same property
    3. C.Pursue the insured's recovery rights against responsible third partiesCorrect answer: C
    4. D.Take ownership of damaged property instead of pursuing responsible parties

    Explanation: The policy refers to "necessary steps for enforcing rights against any other party in the name of the Insured". Subrogation pursues the insured's rights against responsible third parties. Apportionment between insurers is contribution; ownership of damaged property concerns salvage; a second full indemnity would duplicate the same loss.

    Reference: Allianz BI All Risks Estimated Gross Profit FR0113_1 — Section Condition 4: Subrogation, p. 14