Canadian Accredited Insurance Broker (CAIB) Three Practice Exam

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Prepare for the Canadian Accredited Insurance Broker Three Exam. Study with flashcards and multiple-choice questions, each with hints and explanations. Gear up for your certification!

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What is the purpose of the S.E.F. No. 5c Permission to Rent or Lease Endorsement?

It allows for long-term leases
It covers specified lessees only
It extends coverage for rentals to unspecified lessees for up to 30 days
It provides a deductible for rentals

The correct answer is: It extends coverage for rentals to unspecified lessees for up to 30 days

The S.E.F. No. 5c Permission to Rent or Lease Endorsement is designed to extend coverage for rentals to unspecified lessees for a period of up to 30 days. This endorsement is particularly useful for policyholders who may need to rent or lease their vehicle to others without having to specify each individual lessee in advance. It ensures that the coverage remains intact regardless of who is temporarily using the vehicle, as long as the rental or lease does not exceed the 30-day limit. This flexibility is essential for individuals who may wish to share their vehicle or for businesses that rent vehicles to clients or employees. By providing this extension of coverage, the endorsement mitigates insurance gaps that could otherwise occur when a vehicle is rented or leased to someone who is not explicitly named on the insurance policy.