British Columbia Fundamentals of Insurance (FOI) Practice Test 2025 – Your Comprehensive All-in-One Guide to Exam Success!

The statement that is not true regarding conditions for property protection systems is that the insureds shall advise the insurer of any municipal by-law related to such systems. In insurance, property protection systems typically refer to alarm systems, sprinklers, and other safety mechanisms designed to reduce loss risks. Conditions associated with these systems usually focus on their operation and effectiveness, as well as any relevant changes that could impact the insurer’s risk exposure.

The first statement about notifying the insurer of interruptions to such systems is essential because downtime can significantly affect the risk of loss. Maintenance contracts are also important to communicate because their cancellation could lead to lapses in protection, increasing the likelihood of damage or theft.

The requirement to notify the insurer when police services are suspended directly relates to the effectiveness of alarm systems in deterring theft, as reduced police responses can heighten risk. However, municipal by-laws, while potentially relevant to the installation of property protection systems, are not typically a direct concern for insurers unless they specifically impact the properties insured or the compliance of the property with local regulations. Therefore, advising the insurer about by-laws does not fall under the usual conditions set by insurers regarding property protection systems.