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Questions and Answers

Indicate the correct way to insure a snowmobile:

  • Through an O.A.P #1 Owner's Form to cover all the exposures to be insured.
  • By an endorsement to a Homeowners or Tenants policy to cover the Third Party Liability and a Personal Articles Floater for direct damage to the machine. (correct)
  • With an O.A.P. 1 Owner's Form to cover Third Party Liability and Accident Benefits, and an Inland Marine Floater for direct damage to the machine.
  • Through a Snowmobile Floater to cover all the exposures to be insured.

    • An insured requests that the limit of liability in his/her automobile policy O.A.P. 1 be reduced. What is the minimum amount he/she must carry under Ontario law?

  • $100,000/$300,000 - Bodily Injury, $50,000 - Property Damage
  • $500,000 inclusive
  • $200,000 inclusive. (correct)
  • $100,000 inclusive.

    • Your insured owns a van which is used for pleasure purposes is laid off. The insured advises you that until he/she is re-hired, the van will be used to deliver flowers for the local florist. What steps should you take?

  • Make no change
  • Note in the file that the vehicle is being used temporarily for deliveries.
  • Advise the insured to have the van insured by the florist.
  • Advise the insurer to re-classify the van as a commercial risk. (correct)

    • The basic Income Replacement Benefit payable under O.A.P. 1 Owner's Form, Section 4- Accident Benefits Coverage is $400 per week. The actual amount is based on:

    <p>80% of Net Income.</p> Signup and view all the answers

    The owner's policy or insurance coverage on a described automobile is:

    <p>Secondary Coverage</p> Signup and view all the answers

    In Ontario, a threshold is:

    <p>The maximum amount that a policy will pay for any loss involving injuries.</p> Signup and view all the answers

    Which of the following documents must be approved by the provincial government?

    <p>Endorsement forms.</p> Signup and view all the answers

    Which of the following statements is NOT true? Lawsuits in Ontario are:

    <p>Not permitted with respect to non-economic loss unless the threshold has been met.</p> Signup and view all the answers

    Provincial Insurance Acts governing automobile insurance applications state that:

    <p>No application is required unless the insurer wants it.</p> Signup and view all the answers

    To a person who has made or who knows of a material misrepresentation, the insurer is NOT required to pay:

    <p>Death or funeral benefits.</p> Signup and view all the answers

    All accidents and claims within the following time period immediately preceding the application must be disclosed:

    <p>Five (5) years.</p> Signup and view all the answers

    Under the Third Party Liability coverage of an automobile policy, which of the following would not be covered?

    <p>A passenger in the auto.</p> Signup and view all the answers

    Recovery from the responsible party for loss of income as a result of an auto accident, after trial is:

    <p>90% of net income.</p> Signup and view all the answers

    When a third party has been injured, which of the following could jeopardize the insured's auto coverage?

    <p>Not admitting responsibility even if he feels at fault.</p> Signup and view all the answers

    Which one (1) of the following statements is TRUE?

    <p>The family protection endorsement applies only in single vehicle accidents.</p> Signup and view all the answers

    The insured, John Smith, is driving Robert Brown's auto as a temporary substitute auto and is responsible for an accident where the award to the innocent third party amounts to $800,000. Smith carries limits of $1,000,000 while Brown only carries $500,000 on his. Smith's insurer would pay:

    <p>$300,000</p> Signup and view all the answers

    Priorities of payment related to payment of which types of losses under an automobile policy?

    <p>Comprehensive and bodily injury.</p> Signup and view all the answers

    Is a snowmobile considered to be an automobile for insurance purposes in Ontario?

    <p>Only when being operated on a public highway.</p> Signup and view all the answers

    Your client calls to advise he/she needs insurance on a car leased from an automobile dealer. Which one (1) of the following policies is required?

    <p>O.P.F. #6 Non-owned Automobile Form, suitable endorsed.</p> Signup and view all the answers

    An eighteen year old youth enters your office and requests insurance on his new automobile - a Chevrolet Corvette. You know that most insurers are not keen on insuring young drivers with powerful automobiles. However, the premium is substantial and the commission attractive. You

    <p>Give him an application for automobile insurance to complete, which you will then submit, to an insurer.</p> Signup and view all the answers

    Newly acquired automobiles are automatically covered under and O.A.P. 1 Owner's Form provided the insurer is notified:

    <p>.Within 14 days.</p> Signup and view all the answers

    Your insured belongs to a car pool and uses his/her automobile to transport the other three members to work every fourth week. One of the other members drives each of the other three weeks. As his/her insurance broker, what would you recommend to make sure your client is covered against claims from passengers for injures?

    <p>Add &quot;passenger hazard endorsement&quot;</p> Signup and view all the answers

    Under the "What Automobiles Are Covered" section of O.A.P. 1 Owner's Form, a newly acquired automobile is automatically covered for a period of 14 days. This automatic coverage is limited to:

    <p>A vehicle which replaces one already insured under the policy.</p> Signup and view all the answers

    All clients should be counseled regarding the availability of optional benefits available under O.A.P. 1 Owner's Form. Which one (1) of the following is NOT available?

    <p>Increased Income Replacement Benefit.</p> Signup and view all the answers

    As the result of an automobile accident involving two automobiles both registered and insured in Ontario, both cars are damaged. One driver, John Smith, is killed and the other driver, Mary Jones sustains minor injuries. Mary Jones is found 100% liable for the accident. Which one (1) of the following statements is TRUE?

    <p>Mary Jones will not be compensated for her injuries because the accident was her fault.</p> Signup and view all the answers

    Your client calls to advise he/she needs insurance on a car leased from an automobile dealer. Which one (1) of the following policies is required?

    <p>O.P.F. #2 Driver's Form.</p> Signup and view all the answers

    Insurance under O.A.P. 1 Owner's Form, Section 7, Loss or Damage Coverages, is usually subject to a deductible. It does not apply to damage caused by:

    <p>Vandalism</p> Signup and view all the answers

    Uninsured Automobile coverage:

    <p>Only covers bodily injury, but never property damage.</p> Signup and view all the answers

    A client phones to tell you he has bought a high-end stereo system costing $5,000, which has just been installed in his car. What should you tell him?

    <p>Be sure to always lock the car, as there is no coverage if the system is stolen when the car is unlocked.</p> Signup and view all the answers

    One of the following statements is correct. Which one (1) is it? Electronic accessories or equipment are covered under O.A.P. 1 Owner's Form:

    <p>Up to $2,500 is installed after the vehicle is purchased.</p> Signup and view all the answers

    Your insured parks his/her automobile at a shopping mall and on his/her return finds it has been damaged by another vehicle. Your insured has O.A.P. 1 Owner's Form with Liability, Accident Benefits, Comprehensive and OPCF44, Family Protection Endorsement coverages. What section would cover the damage?

    <p>Liability</p> Signup and view all the answers

    Insurance under Section 7 of O.A.P. 1 Owner's Form, Loss or Damage Coverages, is usually subject to a deductible. It does not apply to loss or damage caused by:

    <p>Lightning.</p> Signup and view all the answers

    Your insured calls to report while ice fishing on Lake Simcoe his/her automobile went through the ice. He/she has O.A.P. 1 Owner's Form with Liability, Accident Benefits and Comprehensive Coverages. The insurer:

    <p>Would pay the claim less the deductible.</p> Signup and view all the answers

    The Facility Association is:

    <p>A reinsurance device for accommodating automobile policyholders who wish to have particularly high limits of insurance.</p> Signup and view all the answers

    The insured's automobile is broken into and some articles are taken. Specified perils will Cover:

    <p>Musical instruments that were in the trunk.</p> Signup and view all the answers

    If the insured drove his automobile in to his own garage door, what would be included under the Own Damage coverage of his automobile policy?

    <p>Neither the auto nor the door.</p> Signup and view all the answers

    The insured leaves a tavern, gets in to his auto in an intoxicated state, and causes an accident on the way home. Which of the following would not be covered?

    <p>Damage to another automobile.</p> Signup and view all the answers

    Under Loss of Use (subsequent to a theft of an automobile), reimbursement begins:

    <p>24 hours after the theft has been reported to the insurer.</p> Signup and view all the answers

    A cigarette sets the automobile seat on fire and causes $450 damage. The policy shows a $300 deductible under Specified Perils. The insurer would pay?

    <p>$300</p> Signup and view all the answers

    The OPCF #44 Family Protection coverage:

    <p>Applies a deductible to injury losses.</p> Signup and view all the answers

    In the Additional Agreements of the Insurer, Own Damage, the insurer agrees to waive subrogation against:

    <p>A neighbor driving the auto with the insured's consent.</p> Signup and view all the answers

    A horse and buggy are hit by an automobile. The horse is killed. The automobile has been damaged but not the buggy. Which of the following coverages apply.

    <p>Third Party Liability (Property Damage)</p> Signup and view all the answers

    Rising water is covered under:

    <p>All perils only.</p> Signup and view all the answers

    The insurer is required to pay the money for which it is liable under the automobile insurance contract within sixty days after the:

    <p>Proof of loss has been received by the insurer.</p> Signup and view all the answers

    Your insured has bought a snowmobile and advises you a fourteen year old son will also be operating it. You have provided your insured with an O.A.P. 1, Owner's Form and advise that:

    <p>There is no coverage while the son is driving as he is under sixteen years of age and the coverage cannot be obtained.</p> Signup and view all the answers

    Under Loss of Use due to theft, reimbursement ends upon:

    <p>The date the Insurer tenders settlement.</p> Signup and view all the answers

    Highway Victims Indemnity Funds

    <p>Are operated by the government of all provinces.</p> Signup and view all the answers

    What type of automobile insurance policy provides liability coverage to a person who does not own an automobile but requires coverage for other automobiles?

    <p>Standard non-owned policy.</p> Signup and view all the answers

    Which of the following is covered under the All Perils coverage (own damage) of an automobile policy?

    <p>Radioactive contamination.</p> Signup and view all the answers

    In which of the following situations is coverage available for a temporary substitute automobile?

    <p>The insured rents an automobile while on vacation in Florida.</p> Signup and view all the answers

    The Superintendent of Insurance in Ontario is responsible for all of the following except one.

    <p>licensing of insurance brokers.</p> Signup and view all the answers

    When an insurer claims bankruptcy and can not pay the claims of its policy holders, the Property and Casualty Insurance Compensation Corporation (PACICC) does so on the bankrupt insurer's behalf. What are the maximum amounts can be claimed from PACICC in this situation?

    <p>$250,000 for a single occurrence and up to 70% of unearned premiums, subject to a maximum of $700 per policy.&quot;</p> Signup and view all the answers

    According to the Insurance Act, a Fire policy expires at?

    <p>12.01am standard time at the address of the insured.</p> Signup and view all the answers

    The Insurance Act states that the Removal of Property extension on a fire policy provides coverage for property temporarily removed from the insured premises to prevent loss, damage, destruction or further loss from an insured peril for a maximum period of:

    <p>seven (7) days.</p> Signup and view all the answers

    Which of the following statements is false with regard to the Fire Statutory Conditions?

    <p>An insurer has the right to entry and control of a property which has suffered a loss. An Insured cannot abandon the property to the insurer</p> Signup and view all the answers

    As specified in the Insurance Act, an Insurer will settle a claim under a fire policy by paying the:

    <p>Least of answer a, b or c.</p> Signup and view all the answers

    The Insurance Act states that one of the following situations is not excluded under a fire policy.

    <p>Damage caused by a fire which spread from a neighboring property to the insured property</p> Signup and view all the answers

    A misrepresentation made at the point of the application for a policy:

    <p>makes the policy voidable at the option of the insurer.</p> Signup and view all the answers

    Who controls application forms and policy wordings in Ontario?

    <p>The Superintendent of Insurance at the Financial Services Commission of Ontario.</p> Signup and view all the answers

    Statutory conditions:

    <p>are sections of the Insurance Act which must be printed in conspicuous type on all fire and automobile insurance policies.</p> Signup and view all the answers

    Which of the following is a Peril?

    <p>Smoke from a fire in a neighbouring apartment that enters your apartment through the adjoining ventilation system.</p> Signup and view all the answers

    Which type of loss would be covered under a fire policy as required under the Insurance Act?

    <p>An explosion of a propane tank under your barbeque that damages the exterior wall of your home.</p> Signup and view all the answers

    According to the Fire Statutory Conditions, after a fire loss, the insured must submit a proof of loss form:

    <p>as soon as practicable.</p> Signup and view all the answers

    Should the insurer exercise their option to rebuild a property after a loss, the work must begin:

    <p>45 days after the receipt of the proof of loss.&quot;</p> Signup and view all the answers

    Salvage is:

    <p>Property remaining after a loss which still has some value.</p> Signup and view all the answers

    If an insured is unsatisfied with an offer to settle a claim, under the fire statutory conditions the insured may sue the insurer:

    <p>Within one year after the damage occurs.</p> Signup and view all the answers

    Indemnity

    <p>ensures an insured neither gains nor loses from an insured loss.</p> Signup and view all the answers

    Which of the following is not an element required to be present to make all contracts enforceable at law?

    <p>Utmost good faith between all parties.</p> Signup and view all the answers

    Which of the following does not have the legal capacity to contract?

    <p>Sonia Sutter a.k.a. Sonia's Sports centres.</p> Signup and view all the answers

    The Insurance Act states that a fire policy must include three perils which are:

    <p>Fire, Lightning and Limited Explosion.</p> Signup and view all the answers

    A contract which is against public policy:

    <p>is unenforceable and void.</p> Signup and view all the answers

    Insurance contracts require three additional elements to make an insurance contract enforceable at law. Which of the following is NOT one of these additional elements?

    <p>An unconditional agreement.</p> Signup and view all the answers

    A reinsurer who is taking on a portion of a risk that has already been reinsured is sometimes called:

    <p>a retrocessionaire.</p> Signup and view all the answers

    Treaty reinsurance exists when:

    <p>companies reinsure very large risks and need to discuss specific details of each reinsurance policy.</p> Signup and view all the answers

    A house suffers a fire. In the fire, the bedroom suffers the majority of damage. The original claim is for damage to the bedroom furniture, clothing in the wardrobes, carpeting and curtains. The insured also claims for the value of jewellery that he stated was also lost in the fire. The insurer is able to determine that there was no jewellery present before or after the fire. If the Insurer discovers the fraudulent claim of jewellery:

    <p>the entire claim for all damaged property will be forfeited.</p> Signup and view all the answers

    Who would not be considered to have insurable interest?

    <p>The owner of a building that is totally rented to others.</p> Signup and view all the answers

    To prove that there was a genuine intention of the parties to enter into a contract, it must be shown that the contract was not affected by all of the following except one. Which of the following is NOT one of those conditions?

    <p>An unnecessary delay in completing the contract by one party.</p> Signup and view all the answers

    A basic fire policy will automatically cover all of the following except one. Mark the exception.

    <p>The purchaser of a building after the building has been transferred from the original insured.</p> Signup and view all the answers

    Which of the following is not a generally accepted practice for dealing with risk?

    <p>Ignoring the risk.</p> Signup and view all the answers

    Which of the following is false with regard to subrogation?

    <p>can be pursued by the insured after a claim has been paid by the insurer.</p> Signup and view all the answers

    To qualify for a Homeowner's Policy:

    <p>The dwelling must be owner occupied</p> Signup and view all the answers

    The property section of the Basic Homeowner policy covers:

    <p>Dwelling building, detached private structures, personal property and additional living expenses</p> Signup and view all the answers

    Under a Comprehensive Homeowner's policy, special limits apply to which property only if stolen?

    <p>Stamp collections</p> Signup and view all the answers

    Which of the following is true with respect to deductibles?

    <p>Only one deductible applies per occurrence</p> Signup and view all the answers

    For which of the following is there no special limit of insurance?

    <p>Freezer food</p> Signup and view all the answers

    If you must live elsewhere during construction of an addition to your home (i.e., a three wall extension), your homeowner policy would pay:

    <p>None of the expenses</p> Signup and view all the answers

    Claims settled by paying an amount equal to the replacement cost minus physical depreciation illustrate:

    <p>Actual cash value</p> Signup and view all the answers

    A basic Fire policy does not cover damage which occurs while a property, is to b the knowledge of the insured, vacant or unoccupied for:

    <p>More than consecutive 30 days</p> Signup and view all the answers

    There is no insurable interest when:

    <p>A person borrows property</p> Signup and view all the answers

    Many special policies/endorsements are available to cover items or situations excluded under a Fire policy. Which of the following exclusions can you NOT buy coverage for?

    <p>War risks</p> Signup and view all the answers

    Which of the following statements is false with respect to how Dwelling Building damages are settled under the Guaranteed Replacement Cost provision?

    <p>Construction must begin within 60 days after the receipt of the Proof of Loss by the insurer</p> Signup and view all the answers

    A Homeowner's policy covers $100,000 on contents. $5,000 coverage is scheduled on a ring. It is worth $6,000 when it is stolen, 5 years later. How will the insurance be paid?

    <p>$5,000 under the scheduled policy and $1,000 under the Homeowner policy</p> Signup and view all the answers

    Which of the following is not a Specified Peril as defined by the RIBO Comprehensive Homeowner's policy?

    <p>Theft</p> Signup and view all the answers

    Smoke damage is not covered if it results from:

    <p>A poorly maintained central air oil furnace over a period of time</p> Signup and view all the answers

    Which of the following is true about All-risk policies?

    <p>Unless the policy specifically excludes coverage for a particular event, the loss is covered</p> Signup and view all the answers

    Which of the following is False in regard to the RIBO Comprehensive Homeowner, Tenant and Condominium Unit Owner's Package Policy?

    <p>Dwelling Building claims cannot be settled on an Actual Cash Value basis</p> Signup and view all the answers

    Utmost good faith

    <p>Is only present when the insured, broker and insurer are totally honest about a risk and its insurance</p> Signup and view all the answers

    A material fact is:

    <p>All of the above</p> Signup and view all the answers

    Which statement best describes actual cash value?

    <p>It is the replacement cost less any accumulated physical depreciation</p> Signup and view all the answers

    Which of the following is an element unique to an Insurance contract?

    <p>Indemnity</p> Signup and view all the answers

    Which of the following is not true?

    <p>Treaty reinsurance demands that each risk be discussed between the contracting parties</p> Signup and view all the answers

    Which of the following is true with respect to Misrepresentation?

    <p>Misrepresentations can occur through non-disclosure by the insured of material facts</p> Signup and view all the answers

    Provincial regulation of insurance companies includes

    <p>The approval of all insurance policy wordings used and sold.</p> Signup and view all the answers

    In an insurance contract, the definition of consideration:

    <p>Is anything of value</p> Signup and view all the answers

    Which of the following statements is true with respect to the parties of an Insurance contract?

    <p>The insurer is the second party and the insured is the first party</p> Signup and view all the answers

    Fortuitous means

    <p>Accidental</p> Signup and view all the answers

    While talking with a potential customer, you uncover some details about their home and situation while filling in a homeowner's application. Which of the following is not a moral hazard

    <p>The absence of a handrail on a flight of basement stairs</p> Signup and view all the answers

    Indemnity means

    <p>Putting the insured in the same financial position he was in immediately before the loss</p> Signup and view all the answers

    Insurance is defined as

    <p>The undertaking of one person to indemnify another in the event of a loss</p> Signup and view all the answers

    Hazard is to peril as a loose handrail on a flight of stairs is to

    <p>Negligence</p> Signup and view all the answers

    Which of the following is not true about Insurance companies?

    <p>Lloyds is an example of a stock insurance company</p> Signup and view all the answers

    Which of the following items is NOT included under the dwelling building coverage of a Comprehensive Homeowner's Policy?

    <p>A Greenhouse on the premises</p> Signup and view all the answers

    Which of the following extensions of coverage is subject to a deductible?

    <p>Up to $500 for damage to the building you occupy as a tenant caused by theft or attempted theft</p> Signup and view all the answers

    Which of the following statements regarding coverage for credit and debit cards, forgery and counterfeit money is true?

    <p>There is no coverage if the theft of a debit or credit card was carried out by any person living in the same household as the insured</p> Signup and view all the answers

    The phrase "The items described below are subject to the applicable Special Limit of insurance, however, the limits do not apply to any claim caused by a specified peril" means for each of the items listed:

    <p>The limit applies to theft claims, since they are not within the specified alanivo perils</p> Signup and view all the answers

    Under a Condominium Owner's Comprehensive Form, Loss Assessment coverage pays

    <p>Any amounts assessed to a condominium unit owner for damage to common areas of the Condo due to lack of insurance or under insurance banup for on the part of the Condominium Corporation</p> Signup and view all the answers

    Which of the following losses would be covered under the Comprehensive Tenant's Policy?

    <p>Damage caused when a water pipe in your kitchen burst while you are trying to install a new kitchen sink</p> Signup and view all the answers

    Which element is not distinctive to Insurance contracts?

    <p>Legal Capacity</p> Signup and view all the answers

    The Fire Statutory Conditions

    <p>Are made up of fourteen requirements placed upon both the insured and insurers for their mutual protection and benefit</p> Signup and view all the answers

    Which of the following statements is true?

    <p>Any policy which provides coverage for the peril of fire must also provide coverage for Lightning and Explosion of certain types of gas</p> Signup and view all the answers

    A burglar breaks into your house while you are away at your cottage one weekend. Assuming that some property belonging to each of the following is stolen, who's property would not be covered by the RIBO comprehensive homeowner's policy?

    <p>Your father-in-law, who is currently visiting you from his insured home in Edmonton</p> Signup and view all the answers

    According to the Fire Statutory Conditions, which of the following is not required information on a Proof of Loss form?

    <p>The approximate value of any salvage</p> Signup and view all the answers

    A hazard is

    <p>A condition which may lead to a peril or make a loss more severe</p> Signup and view all the answers

    Which of the following losses would be covered under the RIBO Comprehensive Tenant's form?

    <p>Your dishwasher leaks while you are out causing severe water damage to your Persian rug</p> Signup and view all the answers

    Which of the following statements is false regarding the lock replacement extension of coverage?

    <p>An insurer will replace the locks on any dwellings for which your keys were stolen</p> Signup and view all the answers

    Under the RIB Act, any member who is a sole proprietor, partnership or corporation must carry errors and omissions insurance not less than this amount in respect of any one loss:

    <p>$1,000,000</p> Signup and view all the answers

    Which of the following statements is false?

    <p>A signed application is always required before the issuance of a property policy in Ontario</p> Signup and view all the answers

    An underwriter, when presented with an application for property insurance may do any one of the following except:

    <p>Agree to insure the applicant conditional to also insuring the applicant's automobile.</p> Signup and view all the answers

    Which of the following definitions is incorrect?

    <p>Actual cash value is resale value</p> Signup and view all the answers

    If an insured is unhappy with the settlement offered by an insurance company, the insured can

    <p>Appeal the Financial Services Commission of Ontario to appoint an independent adjuster</p> Signup and view all the answers

    Which coverage would best suit the needs of Accountants, Lawyers and Real Estate Agents?

    <p>Office Equipment Floater</p> Signup and view all the answers

    Which best describes Glass insurance?

    <p>It covers all risks, but excludes damage caused by Fire, War and Nuclear Energy hazards</p> Signup and view all the answers

    Under the Commercial Building, Equipment and Stock form, the definition of equipment includes

    <p>Growing plants used for decoration</p> Signup and view all the answers

    Business Interruption Profits Form

    <p>Provides coverage for as long as the business results are affected, subject to a 100% coinsurance clause</p> Signup and view all the answers

    The Commercial General Liability policy differs from the liability section of a Homeowner policy in that

    <p>There is an aggregate limit under the C.G.L.</p> Signup and view all the answers

    Dr. Smith's office is damaged by fire. She is able to continue her practice at another location due to the settlement from her

    <p>Extra expense form</p> Signup and view all the answers

    What kind of bond is required for an executor of wills?

    <p>Fiduciary Bond</p> Signup and view all the answers

    A driver of an armoured truck is held at gun point and money is stolen. This is an example of

    <p>Inside robbery</p> Signup and view all the answers

    A jewellery store owner takes home some of the jewellery for cleaning. His house is broken into and the jewellery is stolen. Which policy would protect him?

    <p>Jeweller's Block</p> Signup and view all the answers

    Which of the following is not true about Farm policies?

    <p>Livestock coverage is not part of the package policy, necessitating the purchasing of a separate rider if livestock coverage is required</p> Signup and view all the answers

    Product's Liability covers

    <p>Injuries resulting from the use of the product away from the insured's premises</p> Signup and view all the answers

    Which of the following is not covered on a C.G.L. policy?

    <p>Liability arising out of the dishonesty of employees</p> Signup and view all the answers

    A Company is sued for libel after printing wrong information in a newspaper. This would be covered under

    <p>Aggregate Liability</p> Signup and view all the answers

    Surety bonds

    <p>Provide protection for the obligee</p> Signup and view all the answers

    Personal Injury

    <p>Is limited in the amount paid out on a C.G.L. policy</p> Signup and view all the answers

    Which of the following statements is true? Co-insurance clauses

    <p>All of the above</p> Signup and view all the answers

    A building is valued at $400,000. The insurer stipulates an 80% co-insurance clause will apply on the policy. The building is insured for $300,000. Two months later, the building suffers a $200,000 fire loss. How much will the insurer pay?

    <p>$187,500</p> Signup and view all the answers

    A building is valued at $500,000. The insurer stipulates a 75% co-insurance clause will apply on the policy. The building is insured for $300,000. One month after the policy is issued, the building suffers a $300,000 fire loss. How much will the insurer pay?

    <p>$240,000</p> Signup and view all the answers

    A building is valued at $200,000. The insurer stipulates a 60% co-insurance clause will apply on the policy. The building is insured for $150,000. The building suffers a $130,000 theft loss (really big thieves). How much will the insurer pay?

    <p>$130,000</p> Signup and view all the answers

    A building is valued at $250,000. The insurer stipulates an 80% co-insurance clause will apply on the policy. The building is insured for $150,000. The building suffers a $50,000 explosion loss. How much will the Insured pay?

    <p>$12,500</p> Signup and view all the answers

    Which of the following is not a consideration of an underwriter in determining the premium to be charged for a Building, Equipment and Stock form?

    <p>Number of employees</p> Signup and view all the answers

    Under a Homeowner's policy, negligence is defined as:

    <p>b and c</p> Signup and view all the answers

    If you are sued for slander, this would be covered under:

    <p>None of the above</p> Signup and view all the answers

    You intentionally steal property from your neighbour's house and are later sued for damages. This would be covered under:

    <p>None of the above</p> Signup and view all the answers

    Your 8 year old son intentionally kicks a ball through your neighbour's window. You are later sued for damages. This would be covered under:

    <p>None of the above</p> Signup and view all the answers

    Pain and suffering are examples of:

    <p>General damages</p> Signup and view all the answers

    Which of the following is not covered on a personal lines liability policy?

    <p>Exemplary damages</p> Signup and view all the answers

    Damage caused to a hotel room you are staying in as a result of your negligence is covered under a personal liability policy

    <p>For any damage that would be covered under section one, first party coverages of your insurance contract</p> Signup and view all the answers

    Which of the following supplementary payments will the insurer not pay under section II, Liability coverages?

    <p>Legal fees when the insured must pursue an at fault party for damages after an accident on their premises</p> Signup and view all the answers

    Which of the following losses is not excluded under the liability section of a Condominium unit owner's policy?

    <p>You are sued when you accidentally drive a 15 foot long boat you are renting while on vacation into another boat. The horsepower rating on the boat's engine is 50 H.P.</p> Signup and view all the answers

    Under Section 3: Liability coverage, the insured is entitled to:

    <p>Damage to the property in the care, custody or control of the insured.</p> Signup and view all the answers

    The insured has a $300 Comprehensive deductible. In which of the following cases would it not apply?

    <p>A claim for fire damage caused by a wayward cigarette.</p> Signup and view all the answers

    Where would you find Upset coverage under the OAP1?

    <p>In both the Collision and All Perils coverages.</p> Signup and view all the answers

    The wordings on the OAP1 that are legislated are known as the:

    <p>Statutory Conditions.</p> Signup and view all the answers

    Under Ontario's Automobile legislation, Bill 59:

    <p>individuals are permitted to sue for medical expenses for catastrophic impairments.</p> Signup and view all the answers

    Under the requirements where loss or damage to the automobile occurs:

    <p>the insured must protect the vehicle from further damage at his or her own expense.</p> Signup and view all the answers

    A misrepresented fact on an application for automobile insurance (OAF 1) may cause the insurer to:

    <p>Void the contract.</p> Signup and view all the answers

    Which coverages are legally required on an OAP1:

    <p>Third Party Liability, Accident Benefits, Uninsured Automobile and Direct Compensation Property Damage.</p> Signup and view all the answers

    Which of the following statements is not true?

    <p>Premium rebating by brokers is permitted by RIBO provided the insured is advised of the practice before the rebate takes place.</p> Signup and view all the answers

    When the insured purchases a second or replacement vehicle, coverage under OAP1 is:

    <p>Extended for 14 days subject to the coverage already in place.</p> Signup and view all the answers

    Which statement is not true pertaining to terminating an auto policy?

    <p>The insurer can terminate coverage any time subject to a short rate return of premium.</p> Signup and view all the answers

    The insured's car is stolen. The insured is entitled to Loss of Use by Theft coverage only:

    <p>If he had physical damage coverage.</p> Signup and view all the answers

    The definition of insured under Third Party Liability section of the owner's policy includes:

    <p>anyone who personally drives the vehicle with the owner's consent.</p> Signup and view all the answers

    Under the auto policy, on receipt of a proof of loss the insurer:

    <p>must pay for damage to the automobile within 60 days.</p> Signup and view all the answers

    The OAP1 covers:

    <p>Your car being driven in Mexico.</p> Signup and view all the answers

    What additional coverage is there in comprehensive that is not available in Specified Perils?

    <p>Vandalism.</p> Signup and view all the answers

    Ordinary negligence is:

    <p>failure to do what a reasonable and prudent person would do in a given situation.</p> Signup and view all the answers

    Which of the following statements is not true?

    <p>All Canadian jurisdictions require compulsory Accident Benefits coverage.</p> Signup and view all the answers

    When a loss occurs:

    <p>any person to whom any part of the money is payable may give notice.</p> Signup and view all the answers

    Which of the following statements is not true?

    <p>The OAP 1 will pay for all damage caused to a Temporary Substitute Automobile by the insured.</p> Signup and view all the answers

    Suits for pain and suffering, or general damages, are subject to a deductible in Ontario of:

    <p>$30,000 per person.</p> Signup and view all the answers

    Which of the following injuries would be considered not to have met the "threshold":

    <p>A severe concussion.</p> Signup and view all the answers

    Which of the following basic Accident Benefits limits is incorrectly stated?

    <p>The Death benefit pays $25,000 to each dependant that survives the deceased insured by 30 days.</p> Signup and view all the answers

    If the insured is injured in an automobile accident, and subsequently convicted of driving the automobile while impaired, which of the following benefits would be payable?

    <p>Medical, Rehabilitation and Attendant care Benefits.&quot;</p> Signup and view all the answers

    Who would not be covered under the Uninsured Automobile coverage?

    <p>Any relative of either the Named Insured or his or her spouse while the occupant of an uninsured automobile.</p> Signup and view all the answers

    Highway Victims Indemnity funds:

    <p>Will not pay a claimant who is at fault for their injuries.</p> Signup and view all the answers

    The legal minimum limit of Liability coverage for automobile policies in the province of Ontario is:

    <p>$200,000 per occurrence.</p> Signup and view all the answers

    An insured automobile is hit in a parking lot by another motorist while the insured is shopping. When the insured returns to the automobile, the damage caused looks to total about $4,000. There is no note on the automobile, and there are no witnesses to the accident. The insured can claim for the damage from:

    <p>none of the above.</p> Signup and view all the answers

    Which of the following statements is false?

    <p>Comprehensive coverage pays for damage caused by theft of the automobile by an employee of the insured whose duties may include driving the automobile.</p> Signup and view all the answers

    The Absolute Liability provision would not apply:

    <p>When the insured has misplaced their license.</p> Signup and view all the answers

    Your client is a Canadian who vacations in Fort Lauderdale, Florida for six months every year. How would you classify this traveller in terms of travel insurance needs?

    <p>None of the above.</p> Signup and view all the answers

    Your client needs expatriate travel health insurance coverage if she is:

    <p>All of the above.</p> Signup and view all the answers

    Your client is a student who is going to Daytona Beach for a week and plans to go scuba diving. You should look for coverage with:

    <p>No sports restrictions.</p> Signup and view all the answers

    Your client will be travelling outside Canada for longer than the amount of time the provincial health plan will provide out-of-Canada health coverage. You recommend that your client:

    <p>Buy supplementary (secondary) coverage while he is covered under a provincial program, then the expatriate coverage for the remainder of the trip after provincial health coverage terminates.</p> Signup and view all the answers

    Your client has a heart condition. What should you pay special attention to in a travel health insurance plan?

    <p>Both (a) and (c).</p> Signup and view all the answers

    Visitors to Canada need travel health insurance because:

    <p>All of the above.</p> Signup and view all the answers

    Your client is an executive who frequently goes on business trips and is a cross- border shopper. What sort of insurance do you sell to her?

    <p>No insurance - she does not need insurance for short trips.</p> Signup and view all the answers

    Jenna is a computer consultant who has recently accepted a two-year contract position with a US startup company. She will be required to spend two weeks of every month in the US. What type of travel insurance would be most appropriate for Jenna?

    <p>A frequent-traveller's plan for travelling Canadians.</p> Signup and view all the answers

    Which of the following is an example of a pre-existing condition clause?

    <p>All of the above.</p> Signup and view all the answers

    A pre-existing condition is defined as:

    <p>A medical condition which existed prior to the Effective or Departure Date.</p> Signup and view all the answers

    Due diligence

    <p>Requires a broker to study all a company's plans prior to recommendation.</p> Signup and view all the answers

    In terms of premium cost, which of the following is the most likely, ranked from least to most expensive if the client were both healthy and young?

    <p>Short-term, Frequent traveller, Long-term, Expatriate.</p> Signup and view all the answers

    Which of the following is not a typical benefit provided in travel health insurance?

    <p>Long-term convalescent care.</p> Signup and view all the answers

    Claims costs may be reduced or contained by using: a) Preferred provider organization (PPO) networks.

    <p>All of the above.</p> Signup and view all the answers

    Which of the following provinces offer only government compulsory auto insurance?

    <p>British Columbia, Manitoba and Saskatchewan</p> Signup and view all the answers

    The definition of ordinary negligence is:

    <p>the failure to do what a reasonable person would do in a given situation</p> Signup and view all the answers

    A broker/agent is responsible for

    <p>binding only those classes of business and limits that is acceptable to his / her insurer</p> Signup and view all the answers

    An insurance contract contains all of the elements of any other legal contract. One element that must also be contained in a valid contract of insurance is:

    <p>utmost good faith</p> Signup and view all the answers

    An example of a physical hazard would best be described as

    <p>Slippery floors</p> Signup and view all the answers

    The definition of Insurance includes:

    <p>the undertaking by one person to indemnify another person against loss or liability for loss in respect of a certain risk or peril</p> Signup and view all the answers

    As far as reinsurance is concerned, which of the following statements is true?

    <p>The amount one party reinsures with another reinsurer is called a cession</p> Signup and view all the answers

    Which of the following statement is false? The inability to enforce an insurance contract:

    <p>Will not affect the legality of the contract once it has been signed</p> Signup and view all the answers

    Which of the following has no legal status in law and cannot enter into a valid contract?

    <p>Mike's Lumber</p> Signup and view all the answers

    What is the name of the legal process used by insurers when collecting from a responsible 3rd party?

    <p>Subrogation</p> Signup and view all the answers

    Which of the following statements in reference to Statutory Conditions is false?

    <p>Statutory Conditions can be changed at the request of the insured to decrease minimum legislated coverage available</p> Signup and view all the answers

    Which of the following statements best describes the principle of indemnity?

    <p>Payments are intended to put the insured in the same financial position that he was in the prior to the loss - no further loss or profit</p> Signup and view all the answers

    Peril is best defined as

    <p>A condition that may increase the chance of loss</p> Signup and view all the answers

    When an insurer intentionally issues a policy that differs from the application;

    <p>The insurer must notify the insured in writing the ways in which it differs from the application</p> Signup and view all the answers

    Which of the following would not affect the rate on a property insurance policy?

    <p>Fire protection</p> Signup and view all the answers

    Under RIBO regulation 991, section 15, a broker would not be considered to be guilty of misconduct if:

    <p>The broker compares line for line, a potential customer's present insurance coverage with that of a competing company, which he or she represents, in order to point out the benefits of his proposed policy coverage.</p> Signup and view all the answers

    Which of the following has an insurable interest in an automobile?

    <p>The lessee of the automobile</p> Signup and view all the answers

    In Ontario, an auto policy can be changed by the use of approved endorsements

    <p>They may be used to increase limits of insurance and /or reduce deductibles</p> Signup and view all the answers

    Which of the following examples of insurance does not belong under the heading of General Insurance?

    <p>Life insurance</p> Signup and view all the answers

    Applications for insurance policies

    <p>Provide details for assessing and rating a risk</p> Signup and view all the answers

    Which of the following statements is true?

    <p>Third parties are not a party to the policy</p> Signup and view all the answers

    Which of the following statements is false?

    <p>Every member must maintain errors and omissions insurance of at least $500,000 for any one occurrence.</p> Signup and view all the answers

    A member who places insurance with an insurer unlicensed in the province of Ontario must

    <p>Obtain the written consent of the member of the public whom the broker services to the effect that they are aware their coverage will be carried by an unlicensed insurer in the province</p> Signup and view all the answers

    Which of the following is NOT a stipulation of the broker's Code of Conduct as found in RIBO regulation 991, section 14?

    <p>A member who conducts another vocation shall not allow such other vocation to jeopardize the member's integrity, independence or competence</p> Signup and view all the answers

    Under the RIB Act definition, an insurance broker is all of the following, except a person who:

    <p>arranges any payment plan for the premium due under a contract of insurance</p> Signup and view all the answers

    Where the RIBO Discipline Committee finds a member guilty of misconduct, it may do all of the following except:

    <p>Set fines of up to $25,000 and/or imprison the member for up to 12 months</p> Signup and view all the answers

    The Indemnity Agreement in a fire policy specifies that the insurer will pay:

    <p>the least of (a), (b), or (c)</p> Signup and view all the answers

    The insured decides to renovate their home. As a result they have to obtain temporary residence until the work is completed. The Homeowner policy will pay

    <p>none of the expenses</p> Signup and view all the answers

    A property is insured for $100,000 and valued at $150,000. There is a 90% coinsurance clause. A loss of $90,000 occurs. The insurer will pay:

    <p>$66,667</p> Signup and view all the answers

    Under a Fire Policy with an Extended coverage Endorsement which loss is not insured?

    <p>earthquake</p> Signup and view all the answers

    When a standard Mortgage Clause is attached to a policy:

    <p>The insurer could be called upon to pay a loss to the Mortgagee even though the insured has violated a condition of the policy</p> Signup and view all the answers

    The insured's dining room furniture was badly damaged when a fire broke out. The claim was settled by paying an amount equal to the replacement cost of the furniture minus physical depreciation. This illustrates the application of:

    <p>Actual cash value</p> Signup and view all the answers

    The Fire statutory condition - Entry, Control and Abandonment does not entitle the insurer to

    <p>Abandon the insured's claim even if a material misrepresentation on the original application has been determined</p> Signup and view all the answers

    Which of the situations below would be covered by the RIBO Homeowner's Form?

    <p>Pipes freeze and burst causing water damage while insured is away overnight</p> Signup and view all the answers

    Under a Personal Articles endorsement

    <p>Valuations will be required on those items insured on a valued basis</p> Signup and view all the answers

    You have three candlesticks, two of which are stolen. The third candlestick is away and being repaired. Which clause would prevent you from claiming for all three?

    <p>Pair and Set</p> Signup and view all the answers

    You have a Comprehensive Homeowner's policy with a limit of $200,000 for Coverage A and a $250 deductible. In the following circumstances how would your policy apply?

    <p>Your whole house burns down, the insurer will pay $199,750 plus debris removal</p> Signup and view all the answers

    Under Statutory Condition 13 - Replacement, should an insurer choose to replace damaged property instead of making payment for it, the insurer must give written notice of its intention within

    <p>30 days of receiving proof of loss</p> Signup and view all the answers

    Which following statement is false? Since a contract of insurance is said to be a personal contract,

    <p>People who sell a business can under no circumstances sell or assign to the purchaser the insurance on it.</p> Signup and view all the answers

    Which of the following statements is true?

    <p>A friendly fire becomes a hostile fire when it leaves the place provided for it</p> Signup and view all the answers

    A Comprehensive Homeowners policy

    <p>Will cover Outdoor Trees, Shrubs and plants for certain perils and for a specific limit</p> Signup and view all the answers

    Exclusions under all-risks policies are included for various reasons... Which of the following is not one of the reasons?

    <p>Losses that may be deemed too catastrophic</p> Signup and view all the answers

    An extended coverage endorsement attached to a fire policy

    <p>Increases the amount of coverage under the policy</p> Signup and view all the answers

    The RIBO homeowner's form, includes the statement "The limits [listed below] do not apply to any claim caused by a Specified Peril". This statement means:

    <p>The special limits apply if the claim is due to theft</p> Signup and view all the answers

    Under the RIBO homeowner's form, if it is necessary to remove property to protect it from loss, which one of these statements is true?

    <p>The amount of coverage available for 30 days or until the policy expires, whichever occurs first</p> Signup and view all the answers

    Under the RIBO homeowner's form, what type of loss is not required to be reported to the police?

    <p>Burglary</p> Signup and view all the answers

    Which statement is false in regards to your Homeowner's Liability coverage for owned watercraft?

    <p>Damage to the boat itself is covered</p> Signup and view all the answers

    The Voluntary Property Damage section of a Personal Liability Policy excludes damage caused intentionally by an insured over the age of

    <p>12 years</p> Signup and view all the answers

    All of the following are exclusions under your Homeowner's Liability section except:

    <p>The ownership, use or operation of any motorized vehicle, trailer or watercraft.</p> Signup and view all the answers

    Choose the false statement from the following,

    <p>A policy with split limits of $100,000/$200,000/$50,000 means that any one person who is injured is entitled to a maximum settlement of $100,000.</p> Signup and view all the answers

    Personal Injury is

    <p>Injury to a person's character</p> Signup and view all the answers

    Which of the following is not a correct definition under Section II- Liability Coverages of a Homeowner's Policy?

    <p>Property Damage&quot; means physical damage to, or destruction of intangible property.</p> Signup and view all the answers

    Which of the following is considered premises under your Homeowner's Liability?

    <p>A family cemetery plot</p> Signup and view all the answers

    Under Third Party Liability the insurer does not agree to

    <p>Reimburse the insured for the legal expenses that are submitted by the lawyer that the insured hired</p> Signup and view all the answers

    Under the Commercial General Liability policy, which statement is true?

    <p>There is no limitation on how much can be paid out under Bodily Injury and Property Damage section</p> Signup and view all the answers

    An Umbrella Policy:

    <p>Provides excess insurance over another policy</p> Signup and view all the answers

    There are three exclusions on a Glass Policy. These are:

    <p>Fire, war, nuclear damage</p> Signup and view all the answers

    Fidelity insurance covers losses caused by

    <p>Dishonesty</p> Signup and view all the answers

    Which one of the items below would be considered the major difference between the "Profit" and "Earnings" approach to Business Interruption insurance?

    <p>The potential period of indemnity</p> Signup and view all the answers

    Lawyers, Accountants, Insurance Agents, Travel Agents and others providing expert service to the public would be best served by:

    <p>Errors and Omissions</p> Signup and view all the answers

    A type of insurance which protects those who work on the human body or on animals such as doctors, hairdressers, veterinarians is:

    <p>Malpractice</p> Signup and view all the answers

    A Fiduciary is:

    <p>A person to whom the administration of something is entrusted for the benefit of another</p> Signup and view all the answers

    Which statement applies to a Surety Bond?

    <p>When the surety pays a claim it then has the right to recover from the principal</p> Signup and view all the answers

    Under the Third Party Liability coverage, the insured is entitled to:

    <p>Court costs even if they are paid over the policy limits</p> Signup and view all the answers

    Which one of the following is correct pertaining to Condominium insurance?

    <p>the Condo Unit owner owns the space inside the unit, the contents and improvements by the owner</p> Signup and view all the answers

    When there has been an auto loss, the insured is required to:

    <p>Protect the automobile from further loss</p> Signup and view all the answers

    Under the OAP1, the Loss of Use Due to Theft provision

    <p>Will not cover costs until 72 hours after the theft has been reported</p> Signup and view all the answers

    The minimum limit of automobile liability allowable by law in the province of Ontario is $200,000. In the event of claims for both bodily injury and property damage which exceeds the limit, the money will be apportioned:

    <p>$190,000 B.I., $10,000 P.D.</p> Signup and view all the answers

    Except for claimants under the Family Law Act, lawsuits for Non-economic loss due to an automobile accident are subject to which of the following?

    <p>$30,000 per person deductible</p> Signup and view all the answers

    Under the OAP1, the Statutory Condition: Termination does not state

    <p>The actual amount of premium to be refunded</p> Signup and view all the answers

    Your insured has brought a snowmobile and has called to advise you that his 14 year old daughter will also be driving the new machine. Your insured has an existing OAP1 policy for the snowmobile. What do you advise your insured regarding this new information?

    <p>To add OPCF 32 which provides coverage for unlicensed operators when Bb driving the snowmobile off a public road.</p> Signup and view all the answers

    Which of the following would be considered "persons insured" under your Uninsured Automobile coverage?

    <p>Your brother who owns his own auto but is injured while riding in your auto</p> Signup and view all the answers

    Which statement is false pertaining to terminating an Automobile Policy?

    <p>The insured can terminate coverage anytime subject to returned premium on a pro-rata basis</p> Signup and view all the answers

    Which of the following losses is covered under the specified perils section of the auto policy?

    <p>Tapes stolen from the front car seat</p> Signup and view all the answers

    Which of the following is not covered under the OAP 1?

    <p>Custom duties levied when the insured vehicle suffers a blown motor while vacationing in the U.S.A. necessitating replacing the motor</p> Signup and view all the answers

    If you have comprehensive coverage with the standard $300 deductible, the deductible will apply to all of the following losses except:

    <p>Lightning damage to your vehicle</p> Signup and view all the answers

    All of the following statements about the risks insured by the Facility Association are true except which one?

    <p>A broker can assign facility business to any insurer</p> Signup and view all the answers

    All perils provides coverage for all of the following situations except loss or damage

    <p>that results when the insured sells the auto to a stranger whose cheque bounces and then the insured reports it as stolen</p> Signup and view all the answers

    In which of the following situations would your policy apply if an accident occurred?

    <p>A taxi driver friend borrows your vehicle with permission to take his children to school</p> Signup and view all the answers

    Details of past license experience are required on an automobile application for

    <p>A period of 6 years for the applicant and any other drivers living in the same household</p> Signup and view all the answers

    An Ontario Automobile policy covers an insured's auto for accidents occurring

    <p>In Canada, the USA and on a vessel traveling between ports of these two countries</p> Signup and view all the answers

    Which statement about Direct Compensation-Property Damage (DCPD) is true?

    <p>Liability must be established with respect to who is at fault in an accident</p> Signup and view all the answers

    You may be guilty of misrepresentation when you sign an Ontario Application for Automobile insurance and you fail to disclose that

    <p>You have a criminal record</p> Signup and view all the answers

    An elderly Toronto resident, who does not own an auto but whose spouse does, sustains a broken hip when hit by an unidentified hit and run driver while crossing the street at a designated cross walk. Under the Insurance act, this person may collect benefits from

    <p>The insurer of the spouses vehicle</p> Signup and view all the answers

    An unidentified automobile is one

    <p>Whose driver or owner cannot be determined</p> Signup and view all the answers

    The main purpose of the Family Protection Endorsement (OPCF 44R) is to provide Coverage

    <p>For an insured person and his/her dependent family when a third party is at fault, but is uninsured or inadequately insured to cover the insured's claims</p> Signup and view all the answers

    A hit and run driver injures a cyclist, who does not own an auto, which one of the following statements is true?

    <p>The cyclist can claim for injuries against the Ontario Motor Vehicle Compensation Fund</p> Signup and view all the answers

    In the event of an accident involving loss or damage to the insured auto, the insured must

    <p>Give notice in writing to the insurer with full particulars of the loss</p> Signup and view all the answers

    Income replacement coverage under the OAP1 is limited in its coverage to

    <p>Loss of Income but subject to a 14 day waiting period from the date of accident</p> Signup and view all the answers

    Which of the following statements is not a requirement with regard to the Comprehensive Homeowners Policy settlement of a building loss on a replacement cost basis:

    <p>Replacement must be made with due diligence and despatch</p> Signup and view all the answers

    Which of the following has no limitation of amount payable under a homeowner's policy if damaged by fire?

    <p>Jewellery and furs</p> Signup and view all the answers

    Which statement is FALSE?

    <p>An auto with a trailer attached is considered as one vehicle for the purposes Accident Benefits limits</p> Signup and view all the answers

    OHIP provides coverage for medical treatment necessary when the insured is outside of Canada.

    <p>212 days</p> Signup and view all the answers

    Which of the following definitions from a travel health policy is incorrect?

    <p>&quot;Termination Date&quot; means the point at which treatment involving the use of life support machines will discontinue and the patient will be left to perish</p> Signup and view all the answers

    Which one of the following is not excluded under a typical travel health policy?

    <p>The hospitalization of a traveler due to a &quot;mugging&quot; or other violent crime against them</p> Signup and view all the answers

    Which question below would most likely not affect the rate or premium charged for a travel health policy?

    <p>Has the insured ever been convicted of a criminal offence?</p> Signup and view all the answers

    Third Party Administrators (TPA) have made the claims payment processes much simpler for insurers. Costs are shared at the point of payment when an insured is covered by more than one carrier. They serve all of the following purposes except one.

    <p>Encourage customers to select a doctor or medical practitioner of their own choice rather than one suggested</p> Signup and view all the answers

    Visitors to Canada need travel health insurance because:

    <p>All of the above</p> Signup and view all the answers

    Ex-patriot insurance is best suited for

    <p>People who reside in another country for periods over 212 days, or visitors to Canada with no other coverage available</p> Signup and view all the answers

    Pre-existing conditions

    <p>May exclude the coverage for a symptom that occurred within a stated period of a time before the coverage was effected</p> Signup and view all the answers

    Which one of the following statements is not correct?

    <p>The law of large numbers always tells a good underwriter which specific risks will have losses.</p> Signup and view all the answers

    Which of the following is correct?

    <p>A peril is an event which may cause a loss to occur</p> Signup and view all the answers

    A material fact is one that could affect:

    <p>The premium or type of policy available</p> Signup and view all the answers

    A contract is an agreement enforceable at law. Which one of the following answers lists all the necessary requirements that must exist?

    <p>Agreement, genuine intention, consideration, capacity to contract, legality of purpose.</p> Signup and view all the answers

    In general when an insurance company indemnifies an insured it tries to: (select the most correct)

    <p>Put the insured back into the same financial position he was in at the time the loss occurred.</p> Signup and view all the answers

    Actual cash value most clearly means: (select the most correct)

    <p>Replacement cost less accumulated depreciation or plus appreciation which include consideration of likely resale value, degree of deterioration, obsolescence, age and general condition of the property involved</p> Signup and view all the answers

    A physical hazard is:

    <p>A physical characteristic of a risk, which may give rise to a loss</p> Signup and view all the answers

    Referring to the term subrogation, which of the following is correct?

    <p>Subrogation is a legal principle</p> Signup and view all the answers

    Which of the following do not have a fiduciary relationship with their clients?

    <p>Dry Cleaning stores</p> Signup and view all the answers

    Which of the following is not true?

    <p>When a fire leaves the place provided for it and ignites something outside, the original fire is a hostile fire</p> Signup and view all the answers

    The Federal Department of Insurance is most interested in which of the following?

    <p>The financial stability of federally licensed insurance companies</p> Signup and view all the answers

    In Section 2 Liability Coverage of the Homeowners Comprehensive policy, coverage is provided for Voluntary Payment for Damage to Property in which one of the following situations?

    <p>Property of others damaged intentionally by the insured's 10 year old son. for which he is not legally liable.</p> Signup and view all the answers

    Your client has a Comprehensive Condominium policy through your brokerage subject to a $500 deductible. The common areas of the building suffer severe damage which is not covered by the Condominium Corporations Master Policy. The loss is covered under your client's policy. The Corporation has assessed your client $2,000 of the damages. How would your clients policy respond?

    <p>$1,500</p> Signup and view all the answers

    The liability section of a Homeowners Comprehensive policy does NOT provide coverage for which one of the following properties?

    <p>Newly acquired farm premises</p> Signup and view all the answers

    If an insurer discovers a misrepresentation has been made by an insured on a new application, which one of the following steps may the Insurer NOT take if the representation is material to the risk?

    <p>Cancel the contract and retain the entire premium</p> Signup and view all the answers

    To what extent does A2 Loss Assessment Coverage in the Comprehensive Condominium Unit Owners policy cover an assessment against a Unit owner?

    <p>Any covered assessment that is valid under the Corporation, insured by the Unit owners policy and to a limit of $10,000</p> Signup and view all the answers

    Your client has closed their seasonal residence for the winter and is not intending to return until spring. What is the status of the premises?

    <p>Unoccupied</p> Signup and view all the answers

    Which of the following best describes a Comprehensive Tenant Package policy?

    <p>It is the same as Homeowners policy but does not cover building or outbuilding.</p> Signup and view all the answers

    Under a Basic Fire policy, the Insured will receive:

    <p>The least of the above three options.</p> Signup and view all the answers

    Your insured intends to renovate his bungalow and will have to vacate his home for six months to do this. His coverage for additional living expense will:

    <p>Not provide any coverage.</p> Signup and view all the answers

    A Condominium Unit Owners Package policy covers:

    <p>The contents of the unit and the improvements and betterments.</p> Signup and view all the answers

    Your client is selling her house and moving to a low rise condominium and calls you to ask what she should do with her current homeowners policy. How would you advise y client?

    <p>The Homeowners must be replaced by a Condominium Unit Owners policy w gives certain extra coverages she will need as a unit owner.</p> Signup and view all the answers

    Replacement Cost Coverage means:

    <p>The cost of settling the claim based on today's price without depreciation.</p> Signup and view all the answers

    Which of the following is not true in reference to Physical Hazard?

    <p>Poor financial results.</p> Signup and view all the answers

    Which statement is true with reference to Moral Hazard?

    <p>Mental attitude and Character of the person.</p> Signup and view all the answers

    Is loss or damage caused by an earthquake insurable?

    <p>Yes, it can be added to a property policy for an additional premium.</p> Signup and view all the answers

    Your insured has rented the same seasonal dwelling for 20 years for two months. They bring all their clothes, bedding and supplies worth $4000. Unfortunately a fire destroys the building in the first week and all is lost. Your insured has a $50,000 Comprehensive Tenants package. How much would his policy pay above the $500 deductible?

    <p>$3500</p> Signup and view all the answers

    Which of the following is not a part of the insuring agreement?

    <p>Circumstances under which insured receive insurance proceeds.</p> Signup and view all the answers

    A very expensive Waterford Crystal vase would usually be insured under: a. A fine arts floater.

    <p>A fine arts floater.</p> Signup and view all the answers

    Your insured's woodworking hobby has become a retirement business and he has converted his garage to a shop. How would you advise him on the affect to his Comprehensive Homeowners policy?

    <p>You must advise the insurer immediately and arrange separate coverage.</p> Signup and view all the answers

    All but one of the following are examples of conditions that apply to liability claims. Which one does not?

    <p>Claims arising from the transmission of a communicable disease are covered.</p> Signup and view all the answers

    Which statement is not true about Liability insurance?

    <p>Special damages are only awarded for small dollar amounts such as out of pocket expenses</p> Signup and view all the answers

    Which of the following statements is correct?

    <p>Liability policies protect the insured by paying damages for which he is legally liable.</p> Signup and view all the answers

    To prove any tort, the following three elements must be present: duty owed, duty breached and

    <p>Damages suffered as a result of the defendant's direct actions</p> Signup and view all the answers

    Under automobile Third Party liability the insurer does not agree to:

    <p>Reimburse insured for related out of pocket expenses</p> Signup and view all the answers

    Under the Third party liability coverage, the insured is entitled to:

    <p>Court costs even if they are paid over the policy limits</p> Signup and view all the answers

    The general purpose of Section E of the Homeowners Liability Coverage section is to give the insured protection for:

    <p>Injuries caused to others when the insured is negligent and held legally liable</p> Signup and view all the answers

    Product Liability covers:

    <p>hen the product is away from the insured's premises and in the possession of someone else</p> Signup and view all the answers

    Negligence is:

    <p>The failure to exercise the care that a reasonable person would take in a similar set of circumstances</p> Signup and view all the answers

    If children visiting an insured's property without the insured's knowledge are injured, is the insured liable? Select the best answer.

    <p>Yes, the insured is liable because children lack the mature judgment to avoid risk, and therefore the occupier of property must ensure that the premises are safe from any danger whatsoever</p> Signup and view all the answers

    When an insured's dog bites for the first time, is the insured liable for damages committed by the dog? Select the best answer.

    <p>Yes - the insured is liable for any and all damages</p> Signup and view all the answers

    Statutory Conditions in a Fire Policy are primarily to protect the rights of which of the following?

    <p>Both the insured and the insurer</p> Signup and view all the answers

    What is meant by the term Fiduciary?

    <p>One who holds something in trust for another</p> Signup and view all the answers

    Who can an insured employ to represent their interest during a claim?

    <p>Public adjuster</p> Signup and view all the answers

    What is the mechanism that allows an insurance company to transfer some of its risk to another insurance company?

    <p>Reinsurance</p> Signup and view all the answers

    If an agreement never fit the legal definition of a contract, what is it deemed to be?

    <p>Void</p> Signup and view all the answers

    Which of the following is NOT the subject of a Statutory Condition?

    <p>Premium</p> Signup and view all the answers

    The Federal Department of Insurance is most interested in which of the following?

    <p>The financial stability of federally licensed Insurance companies</p> Signup and view all the answers

    Rules or agreements concerning the binding of coverage by brokers are:

    <p>Set out and agreed upon between the insurance company and the broker office</p> Signup and view all the answers

    R.I.B.O (Registered Insurance Brokers of Ontario) is:

    <p>A self regulatory body concerned with the operations of insurance brokers</p> Signup and view all the answers

    Who is protected by a mortgage clause in a property insurance policy?

    <p>The one who lends the money and the insurer of the property</p> Signup and view all the answers

    In general, when an insurance company indemnifies an insured it tries to:

    <p>Put the insured back in the same financial position he/she was in at the time the loss occurred</p> Signup and view all the answers

    In arranging an insurance contract the broker must always:

    <p>Pass on the insurer all relevant information whether requested or not</p> Signup and view all the answers

    Your insured request that his automobile policy be cancelled part way through the term. The refund due to the insured would be calculated on:

    <p>A short rate basis</p> Signup and view all the answers

    In many ways an insurance contract is similar to a legal contract one might encounter. One feature that it does not share with any other contract is:

    <p>Utmost good faith</p> Signup and view all the answers

    Of the following individuals, who has the legal capacity to contract:

    <p>A 16 year old who does not live with her parents and is buying insurance on her car that she needs to drive to work</p> Signup and view all the answers

    What is the major difference between a Homeowners Policy Wording and a Seasonal policy wording?

    <p>All of the above</p> Signup and view all the answers

    Which (1) one of the coverages under a Homeowner's comprehensive policy including inflation protection is NOT automatically increased on renewal?

    <p>Liability</p> Signup and view all the answers

    Which of the following statements is NOT true about a Comprehensive Homeowner's Policy?

    <p>There is no coverage if property is stored in a warehouse.</p> Signup and view all the answers

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