Registered Insurance Brokers of Ontario (RIBO) Practice Exam

In which situation would your policy provide coverage if an accident occurred?

1. The vehicle is borrowed by a friend for personal use

2. A taxi driver friend borrows your vehicle with permission

3. A relative drives your vehicle without permission

4. Any licensed driver uses your vehicle

The correct answer is: A taxi driver friend borrows your vehicle with permission

The situation where your policy would provide coverage if an accident occurred is when a taxi driver friend borrows your vehicle with permission. This choice aligns with the standard practice in auto insurance policies, which typically extend coverage to individuals who have been explicitly granted permission to use the vehicle. In this scenario, since the friend has permission to drive the vehicle, it is expected that the insurance policy would cover an accident. Moreover, as a licensed driver, the taxi driver is likely to have their own insurance, but your policy would still provide coverage in this situation. The other scenarios might not provide the same level of coverage due to various reasons related to permissions or the nature of how the vehicle is being used, which can impact the insurance policy terms and conditions. For instance, vehicles used for commercial purposes (like in a taxi service) may have specific exclusions or requirements in personal auto policies.