In the Fundamentals of Insurance/CAIB 1 course, one of the most important concepts you learn is how insurance companies calculate premiums.
The primary concern for property insurers is the risk of fire. In order to assess this risk, they will ask about the construction of the building and categorize buildings according to one of these 5 types of construction:
- Fire Resistive: this means the material can withstand 2-3 hours in a controlled lab fire.
- Non-Combustible: means that the structural members are made from a non-combustible material.
- Heavy Timber: the structural members are made of wood
- Ordinary: only the load-bearing walls are non-combustible
- Frame: even the supporting walls are made of wood.
While all 5 of these are mentioned in the book, you do not need to know all 5. In general, try to memorize at least 3 of the things listed. This is because on your exams (CAIB in particular) short answer questions are generally out of 3 marks.