Quiz #3 Flashcards
Which of the following is NOT one of the three main areas of supervision of Canadian insurance companies that The Insurance Companies Act covers
Establishment of an insurance company
Prerequisites to operation
Foreign insurance company establishment
Supervision during operation
Foreign insurance company establishment
What is the name of the provincial regulator in New Brunswick
Autorite des marches financiers
Financial and Consumer Services Commission
Financial Institutions Regulation Branch
Financial and Consumer Affairs Authority
Financial and Consumer Services Commission
What is the name of the non-profit organization that responds to claims of policyholders when an insurer becomes insolvent?
Office of the Superintendent of Financial Institutions
Property and Casualty Insurance Compensation Corporation
Financial and Consumer Services Commission
Office of the Superintendent of Insurance
Property and Casualty Insurance Compensation Corporation
A federal statute that governs the collection and use of personal information
Personal Information Protection and Electronic Documents Act
Public Information Protection and Electronic Documents Act
Private Information Protection and Electronic Documents Act
Protected Information and Personal Electronic Documents Act
Personal Information Protection and Electronic Documents Act
Which of the following is not one of the additional requirements of insurance contracts
Indemnity
Utmost Good Faith
Insurable Interest
Consent
Consent
Rhianna has a claim for a water damaged TV. The TV is 5 years old. It will cost $750 to replace the TV. Rhianna has an insurance policy with actual cash value as the basis for settlement of her claim. Her insurance company depreciates the cost to replace by 30%. She also has a $250 deductible that applies to her claim. How much will Rhianna receive by way of settlement of her claim?
$525
$250
$500
$275
$275
Ed’s roof is 10 years old and is damaged during a windstorm. He needs a new roof. It will cost $10,000 to replace his damaged roof. Ed’s insurance policy has a deductible of $500 and he has replacement cost as a valuation method for settling his claim. What will Ed receive under his policy?
The cost of a new roof without depreciation and he does not have to pay the $500 deductible
The cost of a new roof minus depreciation because the roof is 10 years old but he does not have to pay the $500 deductible
The cost of a new roof minus depreciation because the roof is 10 years old and minus the deductible of $500
The cost of a new roof without depreciation minus the deductible of $500
The cost of a new roof without depreciation minus the deductible of $500
Big Insurance Company and Little Insurance Company both insure a building. Big Insurance Company insures the building for $300,000. Little Insurance Company insures the building for $100,000. There is a fire in the building and there is damage valued at $50,000. How much will Little Insurance Company contribute to the loss?
$100,000
$25,000
$12,500
$50,000
$12,500
Pierre’s neighbor’s tree falls on his car and damages it. Pierre’s insurer repairs his car and then seeks a recovery of the money from the neighbor. What is this process called?
Salvage
Subrogation
Contribution
Coinsurance
Subrogation
Which of the following is NOT one of the sections of an insurance policy?
Policy conditions
Policy quotation
Insuring agreements
Coverage summary
Policy quotation
When a policy is cancelled by the insured part way through the policy period they are entitled to a refund of unearned premiums minus an administration fee. What is this type of cancellation called?
Renewal receipt
Pro-rata cancellation
Subscription policy
Short-rate cancellation
Short-rate cancellation
Which of the following three provinces have government automobile insurance
Saskatchewan, Manitoba and British Columbia
Saskatchewan, Manitoba and Newfoundland
Ontario, Quebec and Manitoba
Nova Scotia, Quebec and British Columbia
Saskatchewan, Manitoba and British Columbia
Which of the following departments are unique to insurers
Marketing, Underwriting and Sales
Administration, Sales and Actuarial
Actuarial, Claims and Underwriting
Accounting, Administration and Claims
Actuarial, Claims and Underwriting
Primary Insurance Company has obtained non-proportional/excess of loss reinsurance from The Reinsurance Company. The Reinsurance Company agrees to pay part of any loss that exceeds the priority of $100,000, up to a limit of $500,000. There is a loss totaling $250,000. How much of the loss will The Reinsurance Company pay?
$150,000
$100,000
$500,000
$250,000
$150,000
The mathematical premise that states that the degree of uncertainty is reduced as the number of events increases, is called what?
Law of marginal utility
Law of small numbers
Law of relativity
Law of large numbers
Law of large numbers
