Registered Insurance Brokers of Ontario (RIBO) Practice Exam

If an insured purchases a high-end stereo system for their car, what is the first step they should take regarding coverage?

1. Purchase a separate policy for the stereo

2. Inform the broker to endorse the OAP 1 Owner's Form

3. Provide the original receipt to the dealership

4. Claim the value through home insurance

The correct answer is: Inform the broker to endorse the OAP 1 Owner's Form

The correct step for an insured who purchases a high-end stereo system for their car is to inform the broker to endorse the OAP 1 Owner's Form. The OAP 1 form, or Ontario Automobile Policy, allows for modifications to the base coverage of the vehicle, which is important for ensuring that any significant upgrades or additions, such as a high-end stereo system, are adequately covered under the automobile insurance policy. By notifying the broker, the insured can ensure that the stereo system's value is included in the overall coverage of the vehicle, preventing potential disputes during a claim if the stereo is damaged or stolen. This approach maintains continuity in coverage without needing a separate insurance policy for the stereo, which may not be necessary. The other options may not be appropriate first steps. For instance, purchasing a separate policy could complicate matters and isn't typically required for such personal items in a vehicle. Providing the receipt to the dealership might not establish any insurance coverage and wouldn’t help if the stereo were lost or damaged. Claiming through home insurance may misalign coverage since the stereo is technically part of the vehicle's contents, not part of the homeowner's policy in this scenario.