Registered Insurance Brokers of Ontario (RIBO) Level 2 Practice Exam 2025 - Free RIBO Level 2 Practice Questions and Study Guide

The common exclusion related to contractors' insurance policies for overloading is loss caused by excessive loading of equipment. This exclusion is in place because overloading typically stems from misuse or neglect of operational protocols by the contractor, which often falls outside the purview of insurable risks. Insurance is designed to cover unforeseen events that are not due to careful planning or operational errors.

When a contractor overloads equipment, it can lead to predictable and preventable outcomes, such as equipment failure or accidents. Therefore, insurers do not cover losses associated with such actions, as they are considered to be a result of the insured party's poor judgment or failure to adhere to safety guidelines.

In contrast, damage from equipment positioned on unstable ground, destruction from equipment malfunctions, and loss resulting from fire incidents may be covered under certain circumstances, depending on the specifics of the policy and whether these incidents arise from unforeseen factors outside the control of the insured party. These factors can be more unpredictable and can result from various conditions or events, which makes them more likely to be considered insurable risks.