Questions

Question 1

WHAT IS LLOYDS OF LONDON?

Answer 1

a) A MARKET PLACE WHERE SOME SIGNATORY BROKERS CAN PLACE BUISNESS

Question 2

WHAT IS LLOYDS OF LONDON?

Answer 2

a) A MARKET PLACE WHERE SOME SIGNATORY BROKERS CAN PLACE BUISNESS

Question 3

What is the difference between Facultative and Treaty Insurance?

Answer 3

• Facultative – Reinsurance arranged on a case by case basis and Treaty, Reinsurance Contracts

Question 4

• How can we deal with Risk
  1) Avoidance of Risk – Eliminate all chance of Financial loss (impractical)
  2) Controlling Risk – Taking measures to reduce frequency & severity of losses ex: alarm, stay home after snowfalls
  3) Retention of Risk – Self insurance, large deductible – Large corps and government gCW 500k+ policy
  4) Transfer of Risk – Through Insurance, choosing to go through insurance when you need it.

Answer 4

4) Transfer of Risk – Through Insurance, choosing to go through insurance when you need it.

Question 5

A guy buys a bar (The Bar is a pure risk). It is winter when he purchases it and wants to have a summer patio but isn’t sure yet about the city permit that are required. He has not yet decided the hours of operation but expects to be open until 1 am 6 nights a week and open Sundays till 9pm. Although there are few lounges servicing alcohol in the neighbourhood he is not sure about his alcohol food sales percentages, he expects them to be 50%, 50% ratios

WHAT TYPE OF RISK IS THIS? WHY?

Answer 5

This is a PURE RISK – because The Bar needs insurance, he has a possibility of fire, theft

Question 6

What are the 5 elements needed to enforce a contract? ACL LG

Answer 6

ACL LG

1) Agreement – Offer is made, unconditional, meeting of the minds, oral agreement
2) Consideration – exchange for something – ex premium
3) Legality of Object - It needs to be legal – No insuring drug houses, etc.
4) Legal capacity of parties - Mental capacity, under influence
5) Genuine Intent - Exchange of something of value between two parties – Insurance premium. I paid you for something

Question 7

What are Three additional elements in addition to the 5 basic elements to enforce a contract HINT: II, UF, I

Answer 7

1) Insurable Interest – People have an insurable interest if they can show they would suffer financially by a loss
2) Uberrima Fides – Latin for Utmost Good Faith (UF) Complete honesty
3) Indemnity – Law restricts payment under insurance contract s to ensure people receive the actual amount of their loss – no more, no less

Question 8

THERE ARE FIVE ELEMENTS OF EVERY CONTRACT AND THREE ELEMENTS UNIQUE TO INSURANCE CONTRACTS, WHAT ARE THEY ?
A) Genuine intent, insurable interest, indemnity
b) indemnity, uberrima fides, consideration
c) legal object, insurable interest, indemnity
d) indemnity, integrity, insurable interest

Answer 8

d) indemnity, integrity, insurable interest (They trick us by using integrity which is the same as Uberrima Fides aka Utmost Good Faith

Question 9

Where would a broker look for a binding authority?

Answer 9

Agency/Brokers agreement

Question 10

What does an Endorsement do?
A) adds coverage
B) Removes coverage (You golf course with glass windows, endorsement to remove glass coverage)
C) Amends policy coverage – Adds and removes coverage

Answer 10

C) Amends policy coverage – Adds and removes coverage

Question 11

define Void and provide an example

Answer 11

when a contract is considered never to have existed -

example - purchased a policy after a fire. We would void the policy and refund all premiums

SEEN IN MISREPRESPENTATION - Falsely describing property – misrepresentation of risk, omits to communicate risk or condition can VOID a contract

Question 12

Define Voidable and provide an example

Answer 12

A contract is is voidable to the wrongdoer but not void to damage caused to third parties :

If I arson my own house and the next door neighbors house is damaged we would cover the neighbors house but not the arsonists house

Question 13

A binder aka a cover note is

Answer 13

Binders or cover note is a piece of paper, certificate of insurance stating coverage .

Binders – It is common to bind an insurer on a risk meaning that the broker has committed the insurer to a contract of insurance
Binders may be orally written

Question 14

Riders

Floater:

Answer 14

Rider - Adds additional coverage to an existing contract

Floater - Provides coverage for a property which moves from place to place

Question 15

What are Physical Hazards PROVIDE AN EXAMPLE OF THEM

Answer 15

Hazards you can see and touch

Occupants, building construction, housekeeping, not shoveling driveway

Question 16

*Moral Hazards

Answer 16

Subjective – characteristics of the applicant which may or may not be observed: Eg Financial condition of buisnes, moral character

Question 17

*Difference between a peril and hazard and provide an example

Answer 17

A hazard is the condition of the property that can cause a peril.

Slippery sidewalks, not shoveling, speeding in school zone. The peril is the cause of loss.

Question 18

What is covered under the following policies in building and contents

BASIC, BROAD AND COMPREHENSIVE

Answer 18

– Named Perils, only covers perils listed

• Named Perils on the building
• Named Perils on the contents

Broad – All Risk on building
- Named Perils on contents

Comp

• All Risk on contents
• all risk on building

Question 19

What is covered under the following policies in building and contents

BASIC, BROAD AND COMPREHENSIVE

Answer 19

– Named Perils, only covers perils listed

• Named Perils on the building
• Named Perils on the contents

Broad – All Risk on building
- Named Perils on contents

Comp

• All Risk on contents
• all risk on building

Question 20

what IS COVERED UNDER COVERAGE A FOR OUTDOOR TREES AND SHRUBS, percent, total, perils

Answer 20

Outdoor trees, shrubs, and plants 5% of A/ 500 / tree only covered under the 6 perils (fire, lightning, explosion, impact by aircraft or land vehicle, Riot, Vandalism or malicious acts

Question 21

*COVERAGE A: Dwelling, Building & Attached Structures - WHAT IS COVERED

Hint,

I have a PERMINANT POOL, it’s attached to my house. I store MATERIALS ON and ADJACENT to my house for fixing up my house and pool, one day I had to remove the SUPPLIES TEMPORARLY REMOVED. That day someone hit my tree with their car.

Answer 21

• Anything permanently installed or attached to a house , attached garage, deck, shutters, basketball net, underground swimming pool
• Outdoor swimming pools and their attachments
• *Materials and their supplies on or adjacent (beside) designed for the betterment of this dwelling or private structures
• Building fixtures and fittings, temporarily removed (storage repair)
• Outdoor trees, shrubs, and plants 5% of A/ 500 / tree only covered under the 6 perils (fire, lightning, explosion, impact by aircraft or land vehicle, Riot, Vandalism or malicious acts

Question 22

*A person had $2000 worth of wood delivered and stacked on their lawn. They don’t have enough room for it because they are building more outhouses and a larger deck. They have another stack of wood delivered to dad’s house down the street. Dads house burns down.

where is the wood covered ?

a) Our insureds home policy, coverage A
b) The fathers home policy
C) Our insureds home policy, coverage C section 1 – Contents temporarily removed
d) Not covered

Answer 22

C) Our insureds home policy, coverage C section 1 – Contents temporarily removed

Question 23

COVERAGE B - WHAT IS IT AND HOW MUCH IS EXTENDED FROM COVERAGE COVERAGE a?

Answer 23

Coverage B - Building or structures
- Extends an additional 10% from Coverage A – 10 percent total not 10 percent per outhouse

• Buildings structures located on the premises separated from dwelling by a clear space, if attached only by a fence line, utility line or similar connection only is it detached (aka: Outhouses - Gazebo, detached shed, workshop, greenhouse, hot tub not embedded into the deck. They need to increase coverage B) you can customize the policy and increase as needed

Question 24

Explain contents coverage

Answer 24

Coverage C Contents : - All Contents - On premises all contents of the dwelling

• ON premises all contents normal to maintenance

Off premises contents are also covered if they are temporarily removed world wide

ALL CONTENTS ON AND OFF PREMESIS NORMAL TO MAINTENANCE, OFF PREMISIS WHEN TEMP REMOVED

Question 25

``` Which of the following property is subject ot a special limit of insurance for all insured causes of loss under a home owners package policy A. Jewelry B. Philatelic collection C. Fur and fur garments d. Business property ```

Answer 25

d. Business property

Question 26

What percent of coverage is ALE of coverage A ? WHEN WOULD COVERAGE COME INTO AFFECT ?

Answer 26

20 percent - The Dwelling is damaged by A Peril - when the damage is bad enough to make the dwelling unfit for occupancy requiring the insureds to move out while repairs are being made

Question 27

In Guaranteed replacement cost or RC will the insurer will pay any increased cost of construction due to the application of zoning regulation, demolition repair construction? if yes provide an example, if no provide an example

Answer 27

*The increased cost of construction due to the application of a zoning bi law is Only covered by endorsement

Question 28

What policy excludes wind

Answer 28

The Basic or the Basic fire policy

Question 29

*VACANT:

Answer 29

Regardless of the presence of furnishings, all occupants have moved out, with no intent of returning and no new occupant has taken residency.

Question 30

UNOCCUPIED

Answer 30

There is a big difference between vacant and unoccupied. An unoccupied residence the insured is returning. The vacant is they have moved out with no intent of return

Question 31

what are the Basic policy Perils (7)

Answer 31

Frank explodes, smelly fireworks in Rome, Very uncool man 1) Fire + Lightning 2) Explosion EXCLUSION – Water hammer (WHY, because it’s maintenance) 3) *smoke it must be sudden and unusual, escape from cooking/heat unit . Exclusion – Smoke from Fire place 4) *Falling Objects – Object must first strike the exterior of a building – Tree falls on a patio – it wouldn’t be covered. Tree bounces off the eav, it would be covered because it hit the house first. Kids leaves the patio door open and a golf ball from the park gets hit and strikes the TV – It wouldn’t be covered because the window was left open and it didn’t hit the exterior of the house first. If it hit a screen window it would count 5) *Impact by aircraft or land vehicle - If you or your employee Drive into your own house a student drives home from university and hits your house with his car. IF they have the basic policy it’s not covered under the basic policy but it would be under auto . A nanny hits the house, it is not covered because the Nanny should know where the driveway is. Pets are excluded 6) Riot – City needs to call it a riot 7) Vandalism & Malicious Acts You Vandalize it yourself – Kids have a house party and your concrete fence is graffiti . you ask the son if he vandalized it he says yes, it’s not covered under this basic policy - When the house is under COC who would cover the vandalism, the builder would pay for the damage. Another exclusion is if the house was vacant. Theft

Question 32

Basic policy exclusions 4

Answer 32

W,Y,P,Y,T EXCLUSION – Water hammer (WHY, because it’s maintenance) - you or your employee Drive into your own house - Pets are excluded - You Vandalize it yourself - Theft when house is vacant

Question 33

explain water damage coverage and exclusions

Answer 33

Water Damage – Must be sudden and accidental from a domestic water main, domestic water container, inside or outside dwelling. Damage to the water container is excluded. Ex: Hot tub crack, the hot tub isn’t covered because its wear and tear. ex: Freezing during the normal heating season (Winter) to an unheated portion of the house (Mud Room on Front) *** ex: If away for MORE THEN 4 CONSECUTIVE DAYS days in winter there is no coverage if your pipes freeze unless you have someone **COMPETENT watch your house daily. If shut off the water and drained every tap. ex: Seepage and Leakage, Sewer Back Up, (however there is an endorsement). Ground or surface water (high river)

Question 34

** You can go away for 3 consecutive days to the family day weekend and go to van for 3 ½ days do you need take any precautionary measures for coverage to apply? a Day I left b Day after I left c days after I left d The day after 4 days after I left

Answer 34

b Day after I left (why because I was home today, Jane doesn’t understand this trap question, its unfair)

Question 35

WE have a house and there as a satellite dish on it. A windstorm comes though and blows the dish off the house, and it damages the shingles. Do we cover the loss.

Answer 35

Yes because wind caused the satellite dish to come off causing the damage to the shingles . The actual satellite dish is excluded.

Question 36

When is glass breakage and accidental breakage covered

Answer 36

insured peril excluded while under course or construction vacant FROM ground shifting

Question 37

*THE HOME OWNERS BASIC POLICY PROVIDES COVERAGE FOR THE PERIL OF GLASS BREAKAGE WHICH OF THE FOLLOWING IS TRUE: A. There is no coverage provided when the dwelling is under construction or vacant B. There is no coverage provided if the owner of the dwelling causes the glass breakage c. coverage is automatically included in all situations d. There is coverage when the dwelling is vacant under 30 days.

Answer 37

A. There is no coverage provided when the dwelling is under construction or vacant

Question 38

Under the basic policy when is transportation coverage of your items covered and when is it excluded

Answer 38

Covered provided your items were temporarily removed anywhere in the world EXCLUDED IF AT A Property at another location you own like a (cottage)

Question 39

Theft or attempted theft is covered under the basic policy, when is it NOT (4)

Answer 39

``` EXCEPT not tenants belongings or theft by your tenant theft of your animal, bird or fish, while the house is under COC if you gave your stuff away ``` TENNANTS ANIMMAL - BIRD/FISH COC GIVE AWAY

Question 40

When is electricity covered under the basic policy

Answer 40

a sudden surge

Question 41

Exclusions to basic policy aka named perils, basic, fire policy (17)

Answer 41

1) Farm buildings or buildings used for farm purposes 2) *property at any fair ground or on exhibit – Question on exam, it is excluded under basic 3) Stollen property ie illegal acquired 4) **Debt 5) **Data 6) Lawfully Seized property 7) **occurring when the house is vacant for greater then 30 days after 30 days they need a vacancy permit 8) Caused by Nuclear, war, radioactive, Terrorism 9) Intentional Act Arson/ failure to act – You see your house on fire but because they didn’t like their house, they didn’t call 911 10) Application of heat – what ever you are applying heat to 11) Earth movement, ground movement 12) Caused by the release or discharge or dispersal of fuel oil 13) domestic water container 14) Residence employee – maid or shoveler – lives elsewhere but comes to perform work. 15) service water 16) Terrorism 17) any motorized vehicles are excluded

Question 42

BASIS OF CLAIMS PAYMENT AND what will an insured receive the least of ?

Answer 42

An insured will receive the least of the following ACV (Replacement cost – depreciation) INSUREDS INTEREST IN THE PROPERTY – (WHATEVER THEY CAN SELL IT FOR) POLICY LIMIT

Question 43

The home owners policy contains a basis of claim payment clause regarding a damaged or destroyed building and detached private structures and personal property and payment of monies. This clause states that the insurer will pay a) The cost of repair re replacement without deduction for depreciation b) The ACV of the damaged property on the date of the occurrence c) Up to the insureds financial interest in the property, but not exceeding applicable limit of insurance d) Their rateable proportion of the loss or damage.

Answer 43

c) Up to the insureds financial interest in the property, but not exceeding applicable limit of insurance

Question 44

Explain ACV and when we provide replacement cost if an item is replaced

Answer 44

Actual Cash Value - Depreciation. We provide the difference from ACV to replacement cost if the item is replaced within 180 days

Question 45

Comprehensive Home Policy – What does it cover.

Answer 45

everything is covered unless it’s excluded

Question 46

What are the exclusions under the Comp home policy 14

Answer 46

Buildings used for farm purposes - Property at fairground or on exibit - Same as basic - Illegally Acquired property - Same as basic - Evidence of debt - - Same as basic NEW -Sporting equipment Broken in use -- Damage to your animal, bird or fish unless it’s by a specified peril - Animals – ACV minus depreciation. - Scratching marring, abrasion, of personal property of any fragile or brittle articles unless caused by a sepc peril - Cost of making good faulty material or workmanship - Settling, expansion on contraction - Data - or loss or damaged ca - intentional act or failure to act - Rodents, insects - Smoke by pollution - Rust

Question 47

A guy is snowboarding his snowboard broke. Will the comp policy cover the damage?

Answer 47

No because it was broken while in use

Question 48

An owner of a condo unit has a condo unit owners policy. This policy provides protection for. A Ale based on the amount of personal property b. improvements and betterments done by the owner to his or her unit c. special assessments (Loss Assessment) due to short falls from being under insured in a building loss d. all of the above

Answer 48

d. all of the above

Question 49

You insured purchases a condo unit owners policy. The condo has a policy which does not adequately insure the damages to the common areas. There is 150k loss to the common areas. As a result a loss has been assessed of $2000 per condo unit owners. Your insured is adequately covered but only 75 percent of other condo unit owners are. How will your policy respond. A 75 percent as only 75 percent of other unit owners have adequate coverage b. $2000 less $500 ded c) 112.500 d$15,000

Answer 49

b. $2000 less $500 ded

Question 50

The condo corp has damages to their building and contents. The condo corp has insurance plus your client has insurance on his condo unit as well. which policy will act to cover the damage to the condo building and it’s contents. a. The condo corps master policy will pay the whole amount b. The condo corps insurance will act first and then your clients condo unit owners insurance will cover any shortfall which is evenly divided between the condo owners c. Your clients insurance WILL COVER YOUR PART Divided among the condo owners for the entire damages d. The condo corps insurance will cover the damage to the building but your clients insurance will cover the contents.

Answer 50

The condo corps insurance will act first and then your clients condo unit owners insurance will cover any shortfall which is evenly divided between the condo owners

Question 51

Are losses due to moving mobile home covered under the policy?

Answer 51

No, they would be covered under the trucking policy

Question 52

Explain emergency removal of a mobile home and the deductible

Answer 52

IF a fire is coming and we need to remove the mobile home we will cover the cost. No deductible.

Question 53

What is another name for a rental policy

Answer 53

residential

Question 54

* Comp home policy A home is covered for 220k, including debris removal, how much is the building insured for ? a) 220k b) 231k

Answer 54

220k

Question 55

Extensions of Coverage Comp home policy 9

Answer 55

``` Property removed Moving to another home Fire department charges – No Deductible Freezer food Lock replacement Tear out Arson conviction reward Credit or debit cards, forgery and counterfeit Inflation protection ```

Question 56

Comp home - IF A RIOT HIT YOUR HOME GLASS BROKE, WOULD IT BE COVERED UNDER THIS SECTION

Answer 56

yes

Question 57

COMP - What will we pay if you are Moving to a different home under this section – HOw long does coverage apply

Answer 57

we will pay to insure personal property while in transit to another location within Canada which is to be occupied by you as a principal residence. Coverage applies for 30 days commencing on the date personal property is removed from principle residence but not beyond the date the policy is terminated or expires

Question 58

COMP POLICY - FREEZER FOOD - WHAT AMOUNT WILL WE PAY UNDER THE COMP POLICY, WHAT IS INCLUDED IN THE COVERAGE AND IS THERE A DEDUCTIBLE ?

Answer 58

We will pay $2000 per freezer for frozen foods that aren’t good due to an accidental interruption of power or mechanical breakdown of freezer. This includes damage to the freezer itself. And reasonable expenses to save the food, buying coolers and ice, generators – No deductible EXCLUDED - CIRCUIT BREAKER

Question 59

HOME OWNERS unplugged their freezer to plug in their vacuum. They forget to plug in their freezer. is there coverage?

Answer 59

NO

Question 60

FREEZER - A Cat is behind freezer and unplugs the freezer, is it covered

Answer 60

NO

Question 61

**FREEZER Your client is out of town and a truck runs into his house cutting off the electricity. As a result the food in his freezer goes bad. How will his own home policy respond? A. Nothing – 3rd policy Auto Policy will pay B. His home policy will pay 2000 – deductible C. His home policy will only pay if he bought a freezer food endorsement D. Nothing if he is gone more then 4 days in a normal freezing season

Answer 61

A. Nothing – 3rd policy Auto Policy will pay

Question 62

The inflation protection coverage under a Dwelling Fire Policy a. Increases coverage A during the policy period by the portion by which the latest published building construction index was increased since the last premium due date b. Increases only coverage C c. Increases coverage A and C during the policy period by the portion which the latest published building construction index was increased since the last premium due date d. Increases coverage A during the policy period by the portion by which the latest published building construction index was increased since the last premium due date and charges the insured an additional premium.

Answer 62

a. Increases coverage A during the policy period by the portion by which the latest published building construction index was increased since the last premium due date

Question 63

What are examples of TORT 7

Answer 63

*Defamation of character -Liabel and slander -Nuisance -Trespassing -Assault -Fraud Deceit

Question 64

Whats the difference between Liable and Slander??

Answer 64

Liable is written, ex: slander is said. That guy is a goofball, is slander. If you post something nasty about a business, you could be liable

Question 65

*Elements of Tort (4)

Answer 65

- owe a duty – “she owned a duity not to hurt people” - duty breached “somehow that duty was breached” - As proximate cause damages cause damages could be suffered – ex: you are the wrong dooer “is it possible she is in the wrong?” - results must be foreseeable ex: Have you ever gone the wrong way down the one way street? “what are the results” OWE DUITY DUITY BREACHED FORSEEABLE PROXIMATE DAMAGE

Question 66

wHAT IS A TORT FEEZER

Answer 66

A WRONG DOER

Question 67

Negligence

Answer 67

Doing something that a reasonable person of sound mind would never do

Question 68

Strict liability

Answer 68

Guilty until proven otherwise

Question 69

DUTY OF CARE OF PROPERTY - We have a duty to THESE . In this order

Answer 69

1) utmost duty to CHILDREN – Remove dangers free and CLEAR 2) Licensee (meter man, flyer delivery) – we know they come to a property but we don’t know when. We must warn them of dangers. Beware of Dog sign 3) Invitee – we know they are coming so we need to warn of dangers, things we know of as well as potential dangers 4) Trespasser – we cannot set trap,

Question 70

``` Who whom does the home owner own the greatest care? A)Minor b)Invitee C)Infant D)Thief ```

Answer 70

minor

Question 71

Who do we owe the greatest care to ? a)ubs deliver b) pizza deliver c) thief d) snowmobiler

Answer 71

PIZZA GUY - WHY? BECAUSE WE CALLED THEM

Question 72

WHO IS THE Licensee AND PROVIDE AN EXAMPLE OF THEM

Answer 72

one who comes onto your property with the occupiers consent but the occupier may not know when. Snowmobilers, hunters, mail delivery, others who come to the property. Social guests also because they can drop in.

Question 73

WHAT IS ANOTHER NAME FOR E& O insurance

Answer 73

vicarious liability

Question 74

who is responsible for the liability of an independent contractor? how can we prevent independent contractor liability ? Example of independent contractor liability? An example of when they are not liable ?

Answer 74

Home owners are not liable for the negligence of a contractor if care was taken when hiring the contractor. ex: looking at the contractors reviews, are they are member of the BBB, did someone recommend them? IF they are building us a deck and mess up, it is there liability except in the case where for example I loan the contractor a saw and someone gets hurt. Then the liability is shared.

Question 75

Liability for Animals - are you covered ? If a dog bites someone else who is responsible

Answer 75

IF you own an animal it is covered from a liability standpoint if it bites someone

Question 76

Occurrence

Answer 76

something that happens suddenly and unexpected or over a long party of time or as a continuous and repeated exposure

Question 77

Liability covers

Answer 77

third party damages only on an occurrence basis

Question 78

An accident including continuous or repeated exposure to substantially the same general harmful conditions describes a. Occurrence b. B. an injury c. An accident d. A liability loss

Answer 78

a. Occurrence

Question 79

Under the liability section of a habitational form for coverage to be provided for BI or PD it must be a. Sudden and unexpected b. Continuous and repeated exposure to generally the same harmful condition c. Occurring over a long period of time d. All of the above

Answer 79

D ALL OF THE ABOVE

Question 80

Under the property section of a habitational form for coverage to be provided for BI or property damage it must be a. Sudden and unexpected b. Continuous and repeated expore to generally the same harmful condition c. Occurring over a long period of time d. All of the above.

Answer 80

A

Question 81

SPECIAL DAMAGES VS GENERAL DAMAGES

Answer 81

special - out of pocket expenses, medical expenses, loss of earnings General damages - Less quantifiable expenses such as pain and suffering, disability of future earnings

Question 82

Compensatory Damages

Answer 82

the cost of property damage, to cost of the injury

Question 83

Exempla airy - provide an example

Answer 83

we don’t pay for volunteer time

Question 84

nominal damage

Answer 84

we don’t pay for a fine if you were speeding aka the fine

Question 85

Punitive

Answer 85

The cost to punish

Question 86

``` *A person has a history of drinking and driving and has been convicted three times previously of both offences. He is driving drunk and suspended and this time the judge wants to inpouse penalties not oly to punish him but also to make an example to others. What penalties are not covered by the insurance policy A special damages B punitive damages C general damages D punitive and exemplary damages ```

Answer 86

D punitive and exemplary damages

Question 87

STUDY EFGH ON WORD EXAM

Answer 87

STUDY EFGH ON WORD EXAM

Question 88

NAME SECTION E, F, G & H

Answer 88

E - PERSONAL PREMISES LIABILITY F – Voluntary Medical payments G - Coverage G – Voluntary Property Damage H – Voluntary Compensation for Residence Employees.

Question 89

explain coverage F

Answer 89

Coverage F – Voluntary Medical payments • good neighbour policy to avoid lawsuits, no deductible because a liability coverage • Incurred within 1 year, up to $5000 if someone is injured and you feel liable

Question 90

Explain Coverage G – Voluntary Property Damage

Answer 90

* good neighbour policy to avoid lawsuits, no deductible | * Up to $1000, for accidents unintentionally caused, or even if intentionally caused by a child of

Question 91

Coverage H – Voluntary Compensation for Residence Employees

Answer 91

Very tiny limits if your housecleaner falls cleaning your house

Question 92

First question to ask yourself regarding coinsurance

Answer 92

IS THIS A TOTAL LOSS

Question 93

What is the coinsurance percentage required and minimum amount

Answer 93

claim less then 2 percent of the did, AND if it’s less then $5000.00 we pay out the claim

Question 94

Why is Theft best

Answer 94

if it’s gone it’s covered, all policies have it, even if there are no signs of forced entry

Question 95

explain Burglary coverage

Answer 95

If it’s stolen there is only coverage when forced entry is visible. in Common in Mercantile stock policies (Walmart, target) . For Burglary to be covered there needs to be a threat to the employee

Question 96

*A store clerk is leaving for the night, and doesn’t realize someone is behind her. They see the safe code and steal all the money. What is covered if the store has Broad form coverage with burglary coverage? a. Everything is covered because they have theft b. Nothing is covered as there was no visible sign of forced entry c. Nothing is covered because the store staff was negligent d. The store staff may be charged with theft

Answer 96

B Nothing is covered as there was no visible sign of forced entry

Question 97

Our insured owns a condo in a multi plex. Our condo building has a comp condo policy. They forgot to lock the door to their suite. Someone knows this and enters stealing the tv, stereo, speakers and receiver. How will the policy respond. a. Everything is covered minus their deductible b. Nothing is covered because they were at fault c. Nothing is covered because a condo policy has burglary coverage, not theft d. Theft has no deductible so everything is covered

Answer 97

a. Everything is covered minus their deductible

Question 98

*A client of yours is opening $$ Exchange here inc which is A money exchange location at the airport. They are worried about Theft. Underwriting will only allow the coverage of robbery. How will you explain the difference.

Answer 98

Answer – Because cash is always readily on hand, the loss experience is that these types of businesses are targets therefor the broker will only write the peril of robbery not offering theft . YOu can't have theft, UW's only will allow robbery

Question 99

*The Insured leaves a door unlocked in a seasonal dwelling and leaves the property for two months planning to return to shut the cottage off for fall. There is a theft but the insured is only covered for the peril of “burglary” under his seasonal dwelling property policy. The clients claim has ben denied by the adjuster. How do you explain this to your insured. a) Theft is always covered as the client has a comprehensive cottage policy. The loss has to be greater then their deductible b) The adjuster denied the claim because there was no visible sign of forced entry required for burglary coverage to take effect c. IT is not covered because the client is negligent in leave the cabin unlocked d. the claim has been denied because they did not have someone entering every four days to check it.

Answer 99

b)The adjuster denied the claim because there was no visible sign of forced entry required for burglary coverage to take effect

Question 100

DETAILED Perils of the BASIC commercial policy 7

Answer 100

(A) FIRE OR LIGHTNING (B) (B) EXPLOSION: Except with respect to explosion of natural, coal or manufactured gas, there shall in no event be any liability hereunder for loss or damage caused by explosion, rupture or bursting in or of the following property owned, operated or controlled by the Insured: (C) IMPACT BY AIRCRAFT, SPACECRAFT OR LAND VEHICLE: The terms Aircraft and Spacecraft include articles dropped from them. There shall in no event be any liability for cumulative damage or for loss or damage: (i) caused by land vehicles belonging to or under the control of the Insured or any of his employees; (ii) to aircraft, spacecraft or land vehicles causing the loss; (iii) caused by any aircraft or spacecraft when being taxied or moved inside or outside of a "building". (D) RIOT, VANDALISM OR MALICIOUS ACTS: (E) SMOKE: The term "Smoke" means smoke due to a sudden, unusual and faulty operation of any stationary furnace. There shall in no event be any liability for any cumulative damage. (F) LEAKAGE FROM “FIRE PROTECTIVE EQUIPMENT": The term Leakage from “Fire Protective Equipment” means: (i) the leakage or discharge of water or other substances from; (ii) the collapse of; (iii) the rupture due to freezing of; (G) “fire protective equipment” for the “premises” or for adjoining structures (H) (G) WINDSTORM OR HAIL:

Question 101

what are the Perils of the basic commercial policy (A) FIRE OR LIGHTNING (B) EXPLOSION: (C) IMPACT BY AIRCRAFT, SPACECRAFT OR LAND VEHICLE: (D) RIOT, VANDALISM OR MALICIOUS ACTS: (E) SMOKE: (F) LEAKAGE FROM “FIRE PROTECTIVE EQUIPMENT": (G) WINDSTORM OR HAIL

Answer 101

Perils of the basic commercial policy (A) FIRE OR LIGHTNING (B) EXPLOSION: (C) IMPACT BY AIRCRAFT, SPACECRAFT OR LAND VEHICLE: (D) RIOT, VANDALISM OR MALICIOUS ACTS: (E) SMOKE: (F) LEAKAGE FROM “FIRE PROTECTIVE EQUIPMENT": (G) WINDSTORM OR HAIL:

Question 102

What are all the insured Perils on a commercial property named perils policy except a. Fire, lightning, explosion, riot, smoke, windstorm, burglary b. Fire, lightning, explosion, leakage from fire protective equipment, hail c. Smoke, fire, lightning, impact by aircraft, impact by space craft, windstorm d. None of the above

Answer 102

a. Fire, lightning, explosion, riot, smoke, windstorm, burglary (BURGLARY IS NOT A PERIL)

Question 103

BETWEEN BROAD AND ALL PERILS WHAT POLICY IS MORE EXPENSIVE

Answer 103

Broad for is more expensive

Question 104

BROAD COMMERCIAL - WHAT ARE THE BENEFITS

Answer 104

covers vehicle impact by business owner/manager - Covers all sources of smoke - Covers all sources of smoke excluding agricultural and industrial smudging - Water damage with the exception of flooding - Theft unless it is mercantile stock - Collapse of building except earthquake - All other causes of loss not specifically excluded

Question 105

What is the calculation of premium for commercial policies

Answer 105

ON a 500k building the underwriter came up with a .70 rate per $100 500kx0.70 = 3500

Question 106

*How are commercial policies determined?

Answer 106

- A rate per $100.00

Question 107

WHAT IS LoadingAND WHAT DOES LOADING DO?

Answer 107

An amount added to the base rate to cover more perils - Loading increases the premiums (cost) - Sometimes loading can be a surcharge for additional premium required

Question 108

What is it called with an underwriter adds an additional fee for tickets and claims?

Answer 108

Loading

Question 109

Definition of a Building Commercial Broad

Answer 109

the building(s) described on the "Declarations Page" and includes: (i) fixed structures pertaining to the building(s) and located on the "premises"; (balconies, breezeway) (ii) additions and extensions communicating and in contact with the building(s); (Fencing around school) (iii) permanent fittings and fixtures attached to and forming part of the building(s); (toilets, pools, skylights, doors, French doors, Heating, AC Units) (iv) materials, equipment and supplies on the "premises" for maintenance of, and normal repairs and minor alterations to the "building" or for building services; (shovels, cleaning supplies, (v) growing plants, trees, shrubs or flowers inside the "building" used for decorative purposes when the Insured is the owner of the "building". Fixtures on premises, additions like fencing. permanent fittings attached, toilets, pools, skylights, materials, equipment and supplies, trees and plants inside

Question 110

Definition of Stock

Answer 110

**Stock - Merchandise of every description usual for the insureds business . - Packing, wrapping and advertising materials - Similar property belonging to others which the insured is under obligation to keep insured. Ex: Consignment store may have others cloths which they plan to sell

Question 111

Definition of Equipment

Answer 111

**-generally all contents usual to the insureds business including furniture, furnishings, fittings, fixtures, machinery, tools, utensils and appliances (clocks, fork lift, rolling shelving, photo copy machine, fax machine. All lease equipment cheques may be co payable, toasters, tables and chairs, - LEASED EQUITPMENT -

Question 112

Tenants improvements, where is it covered and what does it cover?

Answer 112

Under equipment III Tenants improvements which are defined as building improvements, alterations and betterments made at the EXPENSE OF THE INSRUED to a building occupied by the insured and which are not otherwise insured provided the insured is not the owner of such building. If the insured purchased the use interest in tenants improvements made by a predecessor tenant this form applies as though such tenants improvements had made at the expense of the insured

Question 113

** Under a mercantile stock burglary policy what is insured and not required for the claim to be successful? a. The insured property was unlawfully taken from within the premises b. The insured property was of high value c. The premises was unlawfully entered d. There were visible signs of forced entry

Answer 113

b. The insured property was of high value

Question 114

**Safe Burglary: The insured must provide the insurer with evidence that a. Force was used to gain access to the safe b. The safe was ULC approved c. The safe contained both cash and securities d. All of the above

Answer 114

a. Force was used to gain access to the safe

Question 115

** Which of the following is not considered part of the building? a. Yard Lights b. Tree Growing inside building c. Tree Growing outside of the building d. Burglary alarm

Answer 115

c. Tree Growing outside of the building

Question 116

* *What is considered as Equipment under a commercial building, equipment, and stock form a. General contents usual to the insured business including tools, furnishings, furniture b. Merchandise of every description c. Materials and supplies on the premises for the building maintenance d. All of the above

Answer 116

a. General contents usual to the insured business including tools, furnishings, furniture

Question 117

**A business owner closes up shop during the slow period and goes to Florida for 3 months leavening all inventory in the store. The store is considered a Vacant but not unoccupied and no coverage b unoccupied but not vacant and insurance in force c. no coverage as the insured is away greater then 30 days d. All of the above

Answer 117

a Vacant but not unoccupied and no coverage

Question 118

**Commercial named perils policy** Are outdoor trees plants and shrubs covered under the building?

Answer 118

- NO they are covered under an extension of coverage

Question 119

In the commercial named perils policy what are the extensions for REMOVAL OF PROPERTY, DEBRIS REMOVAL, REMOVAL OF WINDSTORM DEBRIS

Answer 119

Removal: property can be removed for 7 days Debris removal 25 percent Removal of windstorm debris - IT is extended here

Question 120

A guy is a mechanic, he works for Toyota, he’s been there for 17 years. He needs to supply his own impact tools. He doesn’t take them home every night. Where are his tools covered? A. Under the commercial property policy of Toyota B. Under his home policy via personal tool endorsement C. Contractors equipment floater

Answer 120

C. Contractors equipment floater

Question 121

WHO IS A Warantee

Answer 121

who ever is responsible for SECURING SOMETHING who ever is responsible for setting an alarm and does that job every night - they are a warantee

Question 122

**A boiler at the hospital explodes causing a hospital to catch fire and the result is a total loss to the hospital. Which policies will respond to the loss a. The hospitals CGL will pay because hteh fire is always covered b. Boiler and Machinery policy liability coverage will respond c. Both the hospital commercial policy and the boiler policy will share the loss d. The hospitals policy will respond and subrogate against the boiler insurer

Answer 122

b. Boiler and Machinery policy liability coverage will respond

Question 123

* *Any boiler operating equipment in excess of _____PSI and requires Boiler & Machinery Policy? a. 15 b. 1500 c. 1750 d. 2100

Answer 123

15

Question 124

* *Boiler and Machinery Insurance covers a. Air conditioning units, electric motors, switch gear (circuit breaker is switch gear) b. Air conditioning Units boilers and pressure vessels c. Air condition units, ceiling tiles, duct work and pressure vessels d. A & B

Answer 124

D - A & B

Question 125

When does Business Interruption insurance NOT apply

Answer 125

Business interruption isn’t covered unless a peril causing a loss is covered

Question 126

When is Business interruption cut off if a client has the earnings form

Answer 126

Earnings form cuts them off the second the business re opens

Question 127

Under Business Interruption -Profits Form Coverage - explain it

Answer 127

Profits Form Coverage commences the date the business reopens and is in place until the business income has been fully restored to it’s normal pre loss.

Question 128

what are Other words for business interruption

Answer 128

* Loss of income * Business interruption * Loss sustained

Question 129

* Business interruption insurance, the earnings form a) Pays all expenses regardless of the cause of business interruption? b. pays loss of income expenses but only for 6 months c. coverage commences at the time of loss contingent on the cause being a peril d. coverage commences at the time of loss and ceases when income is restored to the level before the loss occurred

Answer 129

c. coverage commences at the time of loss contingent on the cause being a peril

Question 130

what is the difference in coinsurance between EARNINGS FORM POLICY AND PROFITS POLICY

Answer 130

-EARNINGS form policy require the building to be insured up to 50 to 80 percent coinsurance PROFITS business interruption requires the property insurance on the building to be insured to 100 percent of it’s value – requiring 100 percent coinsurance clause

Question 131

WHAT DOES BURGLARY INSURANCE MUST SHOW INRODER FOR IT TO BE COVERED

Answer 131

force entry or force required from safe

Question 132

*Safe Burglary – is it covered under A property, B Crime policy

Answer 132

B Crime Policy

Question 133

Surety Bonding Name the 3 Bonding parties

Answer 133

P, O, S ; ) Principle is the contractor – buys the surety - the principle is responsible for the surety Obligee owns the project Surety is the Guarantor

Question 134

IS Surity insurance ?

Answer 134

–no It’s more like bonding in banking

Question 135

explain SURITY (5)

Answer 135

Surity is NOT insurance – It’s more like bonding like in banking. - It’s a 3 part contract, guaranteeing performance - signed with a seal by principal and surety co - has no cancellation provision - Indeterminate length of time (term) - Surety company has the right to subrogate from the principal contractor if they default.

Question 136

Which of the following is NOT true of the SURETY a. Bought by the Obligee b. A three party contract signed via sea c. Never are losses expected or anticipated d. Inderminate term

Answer 136

a. Bought by the Obligee

Question 137

* Which is true of a surety a. Bought by principal b. always inderminate policy term c. 3 party contract signed via seal, bought by principal d. All of the above

Answer 137

d. All of the above

Question 138

*What will happen if a contractor bolts town and leaves a job not completed after being paid a proportionate amount at the 50 percent off completion date. a. Give him another chance b. The surety company will help the obigee find another contractor to complete the job and pay any proportionate difference in bids quoted c. Nothing will be done to find a contractor we will leave it like Stoney plain Rd. issue

Answer 138

The surety company will help the obigee find another contractor to complete the job and pay any proportionate difference in bids quoted

Question 139

UNDER THE CGL WHAT DOES SECTION a, b c & d cover

Answer 139

**What does section A cover – BODILY INJURY AND PROPERTY DAMAGE Section B – Personal Injury and advertising Liability – If we used someone’s advertising slogan and they show that they sell less pepsi because we were drinking a coke Section B Medical Payments – The feelgood payment. IF someone is hurt we can pay it ***Section D Tenants Legal Liability (fire, explosion, smoke, water damage) If have a business that keeps belongings in our facility. Landscaping company. They rent a storage facility to keep equipment. a BI AND PROP DAMAGE B - INJURY AND ADVERTISING LIABILITY C MED PAYMENTS D LEGAL LIABILITY

Question 140

**Bodily Injury Means

Answer 140

sickness or disease or death resulting from either of those at anytime

Question 141

**Compensatory

Answer 141

damaged due or awarded in payment for actual injury or economic loss excluded - punitive & expletory

Question 142

CGL APPLIES WHERE IN THE WORLD

Answer 142

CGL – all parts of the world if we are travelling there or shipping there

Question 143

***WHAT IS AN Aggerate Limit

Answer 143

– Maximum we are going to pay in the entire policy term - $ 2 PER CLAIM and a general aggerate limit of 5 million.

Question 144

Business interruption and boiler machinery coverage a. Separate policies that an insured will often require b. Are available via extension of coverage and are included within every commercial policy c. Are endorsements easily added to every commercial policy d. Are never covered under any policy or combination of policies in the insurance industry

Answer 144

a. Separate policies that an insured will often require

Question 145

What does business interruption insurance include? a. Pay expenses when they reduce amount of loss, coverage not limited to policy period. Insures same perils as property policy, a contract of indemnity including paying expenses and loss of profit b. Pays expenses loss of profit and insures the same perils as property policy, coverage limited to policy period c. Insures different perils then property policy a contract of indemnity coverage limited to policy period d. Gives coverage for the business may be forced to close for a lengthy period. The business is able to resume partial operations at the insured or other location

Answer 145

a. Pay expenses when they reduce amount of loss, coverage not limited to policy period. Insures same perils as property policy, a contract of indemnity including paying expenses and loss of profit

Question 146

Why is it important for anyone to have an umbrella policy A. IN the present time people sue more often. The limit on the primary polices is often inadequate for a large loss. An umbrella liability policy is likely to provide better protection for the insured. This type of policy may also cover exposures not covered by the basic lability policy B. It is not important for everyone. The umbrella liability policies are meant to be for people with a specific lifestyle and their positions in the community. An umbrella liability policy is likely to provide better protection for this kind of insured. It may also cover exposures not covered by the basic liability policy C. IT is not important for everyone, an umbrella liability policy is meant for people who travel a lot either for business or pleasure since they provide wide territorials limits cover usually worldwide D. Only people with commercial policies should have an umbrella liability policy because companies are more likely to be sued as an entity.

Answer 146

A. IN the present time people sue more often. The limit on the primary polices is often inadequate for a large loss. An umbrella liability policy is likely to provide better protection for the insured. This type of policy may also cover exposures not covered by the basic lability policy

Question 147

Coverage D of CGL commercial general *what is the difference between an umbrella policy and an excess policy.

Answer 147

EXAMPLE: You have a dealership who has coverage for their auto vehicles The ENTIRE umbrella would have 10 million of coverage and sit under both the Auto and Property exposure and the excess would sit under the CGL

Question 148

*What is section B of a CGL –

Answer 148

Personal and advertising injury liability

Question 149

COMMERCIAL *growing trees plants and shrubs outside the building are excluded, but an extension brings back coverage if loss is caused by a peril, excluding wind and hail. WHAT IS THE LIMIT OF INSURANCE

Answer 149

Limit of 500 per tree up to 5000 per occurrence

Question 150

*Your insured owns home and goes on an extended vacation to Brazil. How side the habitational insurance property policy apply. a. The house is considered unoccupied and therefor fully insured b. The house is vacant not unoccupied and therefor remains insured c. Because the homeowner is away for more then 30 consecutive days the house has no insurance d. Because the home owner is away for 30 consecutive days the house has no insurance

Answer 150

a. The house is considered unoccupied and therefor fully insured

Question 151

You insured owns a business and goes on an extended vacation to Brazil. How does the commercial broad form insurance policy apply to this property? a. The store is considered unoccupied and therefor fully remaining insured b. The store is vacant not unoccupied and therefore remains insured c. Because the store owner is away for more then 30 consecutive days the store has no insurance d. Because the store owner is away for 30 or more consecutive days the store has no insurance

Answer 151

c. Because the store owner is away for more then 30 consecutive days the store has no insurance

Question 152

A home owner loves their trees, shrubs and plants. These are covered under coverage A but only for certain named perils. What limit and to what extend are their trees covered under a basic, broad and comprehensive policy. a. 5% of the dwelling limit up to a max of 5000 per tree, only for fire, wind, hail, theft and snow load b. 5 % of the dwelling, to a max of 5% per tree, only for filre, wind, hail, theft, and lightning c. 10% of Dwelling limit, to a max of $5000 per tree, only for fire, lightning, explosion, impact by aircraft or land vehicle, riot and vandalism d. 5% of dwelling limit to a maximum of $500 per tree, only for fire, lightning, explosion, impact by aircraft or land vehicle, riot and vandalism

Answer 152

d. 5% of dwelling limit to a maximum of $500 per tree, only for fire, lightning, explosion, impact by aircraft or land vehicle, riot and vandalism

Question 153

Outdoor trees, shrubs and plants are covered under a commercial insurance broad form policy a. As part of the building limited to 500 per tree to a limit of 5 percent of the building value b. As part of the building limited to 500 per tree to a limit of $5000 total c. After excluded under excluded property covered as an extension of coverage for named perils with the exception of windstorm and hail and theft or attempted thereat d. After excluded under excluded property, covered as an extension of coverage for named perils with the exception of windstorm and hail

Answer 153

c. After excluded under excluded property covered as an extension of coverage for named perils with the exception of windstorm and hail and theft or attempted thereat

Question 154

hOW IS FARM EQUIPTMENT SOLD

Answer 154

A typical coverage is mobile machinery – it can be scheduled by item or sold on a blanket basis

Question 155

WHAT IS THE common coinsurance FOR FARM EQUIPTMENT

Answer 155

80 percent on farm equipment

Question 156

EXPLAIN THE Deferred Loss settlements clause BUILDING CLAUSE FOR FARM

Answer 156

a)ACV OR 50% which ever is less BUT IF he rebuilds that barn within 9 months and 200 feet THE DLSC will give him replacement cost plus the INTERSEST back. FOR TL ONLY

Question 157

4 facts ABOUT Farm policies

Answer 157

BLANKET OR SCHEDULED NEWLY AQUIRED IS SCHEDULED FOR 30 DAYS 80 PERCENT IS COMMON FOR COINSURANCE **Farm policies are blanket or scheduled coverage so you don’t have to name each cow or horse ** equipment is scheduled **newly is acquired equipment scheduled for? 30 days **What percent of coinsurance is common for farm or farm equipment – 80%

Question 158

hOW IS LIVESTOCK COVERED

Answer 158

on a named perils basis, on a blanket basis

Question 159

UNDER THE FARM POLICY WHAT EXCLUSION IS TESTED

Answer 159

seizure by government order oTHER EXCLUSIONS • Exclusions – damage being loaded, freezing, sickness and disease, neglect, criminal acts, illegally acquired livestock, war

Question 160

Farm Machinery can be purchased on a blanket basis. Replacement cost coverage is available if the piece of equipment is brand new and for this period of time

Answer 160

B. up to 60 months

Question 161

Standard Application TIME CUT OF ?? AND WHERE IS IT BASED

Answer 161

Standard Application – always 12:01 based on the address of the named insured’s address

Question 162

WHAT IS THE BILLING CYCLE FOR SPF 1

Answer 162

pay every 30 days

Question 163

spf 1Section A BI – Third Party Liability – who is covered

Answer 163

Named insured and anyone who with the named insureds consent drives the vehicle or operates any part of it

Question 164

what is excluded under section A BI

Answer 164

Exclusions: The insurer shall not be liable for any liability imposed - worker’s comp - any employee when they are engaged in repair – aka garage repair - Property in vehicle - -only liable up to the section A limit + expenditures in the accidental agreement. - Nuclear radioactive

Question 165

WHAT ARE THE Additional agreements of the insurer UNDER SECTION A SPF 1

Answer 165

- WE pay the investigations and negation settlements cost *WE pay this in addition - Defense cost - ***Liable up to the limit in Canada where driving - ***Not deny a claim that is legal where driving in Canada THE LAW OF THE LAND WILL RULE. WHERE YOU ARE DRIVING YOU NEED TO FILE THOSE RULES OF THE ROAD

Question 166

WHAT IS THE PRIORITY OF PAYMENT IN CANADA

Answer 166

The minimum in Alberta is 200,000, if there is a a BI claim we need to reserve 190,000.00 and PD 10,000.00. We need to reserve 95% to BI and 5% to PD

Question 167

* A client is injured in an accident they have used their 21 DTPR treatments, they don’t have a group benefits plan. How much under section B if they only require chiropractic a. 50k b. 51k

Answer 167

51K

Question 168

*Under subsection 2 part 1 section B of the spf 1 who is the Head of household . a. The person in the household with the largest income b. the person with the largest income in the year preceding the date of the accident

Answer 168

b. the person with the largest income in the year preceding the date of the accident

Question 169

*Under section B, sub section 2, part 2 total disability. Benefits are payable A. After a 7 day waiting period payable for up to 104 weeks B. After a 60 day waiting period payable for up to 104 weeks

Answer 169

A. After a 7 day waiting period payable for up to 104 weeks

Question 170

WHAT IS THE HOLDINGI PERIOD BEFORE TD BENEFITS CAN BE PAID. WHAT ARE THE MAX NUMBER OF WEEKS?

Answer 170

There is no benefit for 7 days and the benefit cuts off at 104 weeks. Pays the least of 600/week or 80 percent of your pre disability income

Question 171

std is paid on what indemnity

Answer 171

STD

Question 172

Section B - Subsection 3 Uninsured third party/Unidentified motorized vehicle PAYS

Answer 172

- **IF in the case of a hit and run - Claim within 30 days - Report to policy within 24 hours - DONT know who hit us - WE would like an inspection of your vehicle

Question 173

Your client bought subsection 4 of section C (specified peril) Which of the following is NOT excluded under specified perils a. Wind, hail, vandalism, fire, lighting, b. Fire, wind, hail, falling objects, theft c. Theft, attempted theft, hail, vandalism, windstorm d. Tornado, fire, attempted theft, explosion, hail

Answer 173

d. Tornado, fire, attempted theft, explosion, hail

Question 174

**Loss of use by theft – without SEF 20 COVERS

Answer 174

by theft of the entire vehicle. We will cover no more then 25.00 per day not totaling more then (700 OLD limit $900.00 new limit for rental or substitute) . WHEN stolen and not recovered withing 72 hours.

Question 175

**Using the additional agreements section C of SPF1 and the vehicle has been stolen when does the coverage commence for alternate transit cost? A. 72 hours B. Immediately c. After the vehicle has been reported stolen to the police d. The day after the vehicle has been reported stolen to the police or to the insurer

Answer 175

a 72 hours

Question 176

**Which of the following perils will the insurer not apply a deductible under subsections 1,3 or 4 of section C All and SPF 1 A)FIRE, WINDSTORM AND HAIL B) FIRE, LIGHTNING AND THEFT C) Fire, lightning, and certain types of explosions D)Fire, lightning, and theft of the entire vehicle

Answer 176

D)Fire, lightning, and theft of the entire vehicle

Question 177

Farmer Joes’s 16 year old daughter stole his truck and drove into a hardware store the vehicle to take into town. She is a great driver because she has been riving around the farm since she was 8 years old. One day in town she drives the vehicle into ace hardware causing $3000 to the store and $3000 damage to his truck. How much will his auto policy pay, he carries section A, section C comp and collision a. $3000 b. $6000 c. $1500 d. Nothing

Answer 177

a 3000

Question 178

You insureds vehicle is parked in front of a bank, a bank robber steals the vehicle and races away to flee the scene. The vehicle is involved in a police chase. How will your insureds SPF 1 respond? a. There is no coverage as a robber was in a race with the police b. It would be covered under section C, all perils or comp if the owner of the vehicle bought section C c. It would be covered under section C, all perils, comprehensive or Specified perils if the owner of the vehicle bought section C d. There is no coverage as the robber didn’t have the owners permission to use the care

Answer 178

C

Question 179

**Rock Chips** If a rock chip hits your windshield and breaks it is it covered if you have Comprehensive coverage OR Specified perils –

Answer 179

yes COMP NO Specified perils no because the rock would need to come off an air Canada jet . If I had all perils it would also be covered.

Question 180

Your insureds vehicle is stolen. The thief drives into a church causing 30,000 damage to the church. The thief’s injuries are $3000 damage to the vehicle itself. The client carries $1000,000 section A, section B plus section C with 500 coll ded and 300 comp ded. How much is the insurer responding to pay?

Answer 180

*We have no coverage under section a, so there is no property damage. If a vehicle is taken without consent, there is no deductible if a vehicle has been stolen

Question 181

*a person has a motor home comp and it’s parked in a Quonset and mice eat the seats. Would it be covered if I had comp, would it be covered if I had specified perils

Answer 181

YES COMP, NO SPEC PERILS

Question 182

Farmer Joes’s 16 year old daughter stole his truck and drove into a hardware store the vehicle to take into town. She is a great driver because she has been riving around the farm since she was 8 years old. One day in town she drives the vehicle into ace hardware causing $3000 to the store and $3000 damage to his truck. How much will his auto policy pay, he carries section A, section C comp and collision

Answer 182

* Key word – stole, so she is using the vehicle without consent, so we have no coverage A, What if he had All Perils?? If he had all perils he no longer has the exclusion of theft for household a. $3000 – If all perils – we would pay $3000.00 if he had comp we would pay nothing and there would be no deductible for theft of an entire vehicle

Question 183

``` **Why?? Exclusion under all perils - The conveyance (what was transporting the vehicle piece for the snowmobile to covered the trailer had to go down the hole. A. Subsection 2 B. Subsection 3 C. Subsection 4 D. No covered ```

Answer 183

D NO COVERAGE

Question 184

** Which of the following perils would not be excluded under Subsection 3 of section C a. Our insured drives over a curb on an icy street damaging the under carriage of the vehicle b. Our insured back into a fence post c. Our insureds vehicle is jacked up and all four tires are stolen *why because under comp theft is excluded by household or employee** d. None of the above

Answer 184

c. Our insureds vehicle is jacked up and all four tires are stolen *why because under comp theft is excluded by household or employee**

Question 185

* The notice to authority’s clause requires an insured to give notice to the police or other law enforcement agencies if loss or damage is due to a. Windstorm b. Water damage c. Theft d. All of the above

Answer 185

C THEFT

Question 186

* The insured carries section A, Section B, Section C Subsections 2 and 3 which of the following perils would define collision? a) Our insured drives into a ditch damaging their vehicle b) Our insured drives over a log on the ground damaging their vehicle c) Our insured drives curp in a parking lot damaging their vehicle d) All of the above are collision.

Answer 186

d) All of the above are collision.

Question 187

* *Which of the following causes of loss would the insurer define as comp a. Our insured drives into a ditch damaging their vehicle b. Our insured drives into a log on the ground damaging their vehicle c. Our insured drives over a dead cow on the highway damaging the vehicle d. Our insured has a bird swoop into their open sunroof

Answer 187

d. Our insured has a bird swoop into their open sunroof

Question 188

Which of the following would define all perils? A. All perils is collision plus comp with a common deductible B. All perils is more expensive generally then collision plus comp C. All perils does not exist on an auto policy D. All perils is the same as specified perils

Answer 188

A. All perils is collision plus comp with a common deductible

Question 189

Which of the following is covered under comprehensive that would not be covered under specified perils A windstorm, hail, explosion, rising water, key scratch in parking lot, theft of baby seat strapped to vehicle *vandalism not covered* b. wind, hail, explosion, lighting, rising water, theft, attempted theft damage c. Windstorm, hail, explosion d. specified perils and comp cover the same things

Answer 189

A windstorm, hail, explosion, rising water, key scratch in parking lot, theft of baby seat strapped to vehicle *vandalism not covered*

Question 190

SPF 1 DRIVING territory and exclusions. Where can a vehicle drive and be for the policy to respond ?

Answer 190

Vehicle can drive in Canada and us and on a vessel between these two countries

Question 191

Your insureds vehicle is stolen while parked outside a bank . It was stolen by a bank robber. A police chase and the vehicle is driven into a church. How does the policy respond a. Nothing because the vehicle was used without consent b. No coverage for the church but the vehicle damage is covered whether the customer bought section C, all perils or comprehensive c. No coverage for the church damages but the vehicle damage is covered if the client bought all perils, comp, or specified perils

Answer 191

c. No coverage for the church damages but the vehicle damage is covered if the client bought all perils, comp, or specified perils

Question 192

**Farmer Joe lets his 12 year old daughter drive the truck to town *prohibited use states that a driver must be 16* Shes a great driver because she’s been driving for years on the farm. She hits a Hardwar store in town causing $3000 damage to the store and $3000 damage to his truck. How much will farmer joe’s auto policy pay. a. Nothing b. $3000 c. $6000 d. $1500

Answer 192

b 3000

Question 193

Newly Acquired Vehicle **We can’t release the vehicle until we get a liability certificate aka pink slip** what timeframe is the vehicle covered for

Answer 193

within 14 days from the date they take possession of the car. Or acquisition of the car. A newly acquired vehicle ownership of which is aquired by the insured and withing 14 days following it’s delivery to them they notify the insurer. If it replaces the vehicle or the insurer ensures all automobiles owned by the insured

Question 194

Excluded uses by insured SPF 1

Answer 194

* Excluded uses - Renting out your vehicle or leasing it out for a profit for others - carrying explosives * -carrying passengers for compensation/money – There are 5 times you can do this and not require a endorsement - Car pooling, - because no money is exchanging hands - Occasional ride share - Domestic servant – Taking nanny to the store - Taking your client somewhere ex: realtor. They only get paid if they sell the house. Therefor they don’t need the endorsement - Occasional use of vehicle for transport of children for educational activities or sport activities.

Question 195

**A church volunteer. 4 times a summer she takes children to a youth camp. She’s planning to do it again this summer. She asks the broker if she needs an endorsement.

Answer 195

- No because she is a volunteer. This means for free. No exchange of funds. IF she was getting paid, we would need an endorsement

Question 196

Auto Statutory conditions

Answer 196

``` Page 13 SPF 1 – CANNOT drive or race a vehicle Illicit illegal You need to be 16 to drive a vehicle Not driving when license is suspended **unless he is either authorized by law or qualified to drive** ```

Question 197

our client is 51 he got his license at 16 and forgot to get their new photo taken, He gets into an accident . Would be still pay the claim.

Answer 197

Yes. Because they are qualified to drive.

Question 198

* Prohibited use by the insured states that the insured shall not drive or operate their automobile unless they are a. Authorized by law b. B. qualified to drive c. C authorized by law and qualified to drive d. Authorized by law or qualified to drive

Answer 198

d. Authorized by law or qualified to drive

Question 199

Under the standard owners form SPF 1 which of the following uses unless permission is given by the insurer are prohibited regardless a. Carrying explosive b. Carrying passengers for compensation c. Rental or lease or automobile d. Any race or speed test

Answer 199

d. Any race or speed test

Question 200

Comparing requirements after loss between property and auto -ASAP we need POL under property. If we are cash settling **2b. Don’t interfere with any negotiation or any legal proceeding. It is now a stat con you need to use our lawyer. **2a. the insured shall now voluntarily assume liability or self settle any claim unless they are doing so at their own expense ** At the expense of the insurance company as far as reasonably possible try to protect that vehicle from further damage if in the case of a loss, but don’t just repair it all before the adjuster to assess the damage **Here we have 7 days to tell them we will repair or replace the vehicle. If it was a property claim it’s 30 days. Appraisal – if in the case of a disagreement we can get an appraisal **If we choose to cash settle the vehicle we have 60 days unless we decide to go through the disagreement/appraisal process then we have 15 days from the appraisal **When action can be brought – you have 2 years to claim. Don’t sue us until you tell us about the loss. *Termination – Same as home owners. *Accidents and claims 6 years, Tickets 3 years*

Answer 200

Comparing requirements after loss between property and auto -ASAP we need POL under property. If we are cash settling **2b. Don’t interfere with any negotiation or any legal proceeding. It is now a stat con you need to use our lawyer. **2a. the insured shall now voluntarily assume liability or self settle any claim unless they are doing so at their own expense ** At the expense of the insurance company as far as reasonably possible try to protect that vehicle from further damage if in the case of a loss, but don’t just repair it all before the adjuster to assess the damage **Here we have 7 days to tell them we will repair or replace the vehicle. If it was a property claim it’s 30 days. Appraisal – if in the case of a disagreement we can get an appraisal **If we choose to cash settle the vehicle we have 60 days unless we decide to go through the disagreement/appraisal process then we have 15 days from the appraisal **When action can be brought – you have 2 years to claim. Don’t sue us until you tell us about the loss. *Termination – Same as home owners. *Accidents and claims 6 years, Tickets 3 years*

Question 201

WHAT IS THE Facility Association

Answer 201

Organization is co owned by all insurance companies in insurance. A certain percentage to a pool so owned by each insurance company. After 6 years if they have a better record the insured may. Its designed to cover those who do not qualify for preferred rates

Question 202

*Using the loss of use endorsement, SEF 20 and the vehicle has been stolen. When can alternate transit cost coverage commence. A immediately b. 72 hours c. day after the report of theft to police d. the day after the vehicle report to the insurer

Answer 202

A immediately

Question 203

Clients are renting a car in Florida.they carry a section A, section B and Section C subsections 2 and 3 under their Alberta Insured SPF 1. All of the following coverages extend to the rental vehicle what is the coverage that doesn’t go across. a. Damage to the hoten when the insured drives into it b. Damage to the hotel concierge when the insured drives into him c. Injury to the insureds son who is insured in the back seat when the insrud drives into the hotel d. Damage to the rental vehicle when the insured drives into the hotel

Answer 203

d. Damage to the rental vehicle when the insured drives into the hotel **why?? Because they need the sef 27 inorder for it it carry over

Question 204

A common carrier is one who - a. transports its own goods and vehicles b. engages in transporting merchandise under an individual contract for a limited number of customers c. offers his or her services for hire d. is a truck driver who owns his or her vehicle and works under contract for a carrier

Answer 204

c. offers his or her services for hire

Question 205

Janice smith owns an online business selling products to a nail technicians . her products are warehoused in her basement. She has one employee who helps her fill orders and package products for shipment at the end of each shift her employee uses her own vehicle to transport the packages to the local office on her way home from work. Which of the following auto policies does Janice need to protect herself.

Answer 205

STANDARD NON OWNED SPF 6

Question 206

AN SPF 9 TRANSPORTATION NETOWRK IS NEEDED WHEN PRIVATLEY OWNED VHICLES ARE USED FOR A. Passenger hazard is a concern B. Privately owned vehicles are used for ridder sharing purposes C. An individual car pools with others D. All of the above

Answer 206

B. Privately owned vehicles are used for ridder sharing purposes

Question 207

SEF 21B BLANKET FLEET ENDORSEMENT MAY BE ATTACHED TO A COMMERIAL AUTOMOBILE FLEET POLICY. The endorsement specifies how the rating applies. Which of the following statements is FALSE with respect to he sef 21b? a. A monthly reporting is required by the insured b. An advance premium is required at the inception of the policy c. Premium adjustments will be made at the end of the policy d. All vehicles owned by or leased to the insured at the inception fo the policy must be filed with the insurer

Answer 207

A monthly reporting is required by the insured

Question 208

*who offers the CIP program

Answer 208

The insurance institute of Canada AKA IIC

Question 209

WHAT ARE THE url's for the INSURANCE BROKERS ACCOCIATION OF ALBERTA

Answer 209

WWW.IBAA.CA AND WWW.IBAC.CA

Question 210

*Who DOES NOT offer continuing education credits – A. Insurance Bureau of Canada IBC b. Insurance Brokers Association of Canada (IBAC/IBAA) C. IIC – Insurance institute of Canada d. Canadian Risk Managed (CRM)

Answer 210

A. Insurance Bureau of Canada IBC

Question 211

what do the *PACICC do

Answer 211

PROPERTY AND CASUALTY INSURANCE COMPENSATION CORP -If an insurance company is about to go bankrupt. If the insurance company goes insolvent (unable to pay claims) This will protect the customer.

Question 212

Which organization assists the insurance dif they insurance has failed solvency tests and cannot pay a property claim due to bankruptcy

Answer 212

C. Property and casualty insurance compensation corporation (PACICC)

Question 213

How is the broker paid, where is the money deposited, are they paid net or gross of the commission

Answer 213

they have their commission deposited to a trust account and they are paid NET of our commission

Question 214

*A client doesn’t have the full 1200 annual premium. They have been cancelled off payplan at 3 other insurance companies. The brokerage can offer the clients a deal. They can pay a portion up front by E Transfer or Cash. They would send the paid portion of the premium to the insurance company excluding their commission for a customer service gesture. How will the insurer respond? a. Pay nothing the policy would have cancelled b. The loss is paid in full, but it is the brokers job to collect the outstanding premiums c. Rebuild ½ the house d. The loss is paid in full, but it is the insurers job to collect the outstanding premiums

Answer 214

b. The loss is paid in full, but it is the brokers job to collect the outstanding premiums

Question 215

What is one way to collect unpaid premiums

Answer 215

If a loss occurs and a premium is paid, the insurer can deduct the unpaid premium from the claim

Question 216

- Main function of the Insurance Institute of Canada, what do they offer ? 2

Answer 216

They are an educational organization. The CIP program

Question 217

who reports to the minister of finance do in the financial structure of insurance ?

Answer 217

Everyone reports to the MOF oversees everything

Question 218

who is the Superintendent of Insurance

Answer 218

Nilam Jetha

Question 219

what does the Office of superintendent of financial institutions (OSFI) DO?

Answer 219

- OFSI -Measure financial solvency of any federally inc. insure INTACT, DESJARDENS, ETC

Question 220

what does the Provincial Superintendent of Insurance do? 3

Answer 220

The PSOI approves policies and overseas licensing and measures solvency of provincial insurance Co's - APPROVE, OVERSEA & MEASURE Approve policy wording - Oversees insurance licencing (AIC) - MEASURES SOLVENCY OF AB insurance co’s provincial (AMA)

Question 221

What does the AIC DO?

Answer 221

* License renewals, continuing education, E& O and compliance is tested * Industry and Trade Associations

Question 222

- What are the certificate terms for continuing education? aka effective DATES

Answer 222

Effective July 1, 2014, a “certificate term” means the period beginning on July 1 and ending on the next June 30.

Question 223

What are my CE requirements, how many credits do I need, how many per month?

Answer 223

You are required to have completed 15 CE hours of approved courses each year in order to process the renewal of your license. 1.25 per month

Question 224

WHO DOESN'T NEED TO BE LICENCED

Answer 224

- Those who only sell hail or livestock don’t need CE

Question 225

Are there any credit exemptions for maternity leave or STD

Answer 225

: There are no provisions under the Insurance Act or Regulations to allow an exemption for those agents who are on long term disability or maternity leave

Question 226

Are there any carry over credits?

Answer 226

yes 7.5

Question 227

What are the requirements for new agents? how many credits do you need per month? What date do you not require any additional CE credits for new licensees?

Answer 227

1.25 per month if it’s your first license you will not be required to complete CE after April 1

Question 228

What is the general insurance council? 4 What do they decide? What type of license do they require? Who do they report to?

Answer 228

It is a Volunteer Insurance council members decide discipline actions, and exam content members Need a level 2 license. They do not report to the AIC.

Question 229

* If you fail the exam for general level one ho many attempts are you allowed a. 2 more tries with 36 month imposed restriction after the 3rd try b. 1 more try with mandatory 6 month imposed restriction c. 1 more try with 1 years mandatory restriction d. 2 more tries with 9 m month imposed restriction

Answer 229

a. 2 more tries with 36 month imposed restriction after the 3rd try

Question 230

What do you need to be a level 3, what does level 2 entitle you to ?

Answer 230

LEvel 3 needs to be a Level 2 for at least 24 months of previous 36 months Level 2 can work alone

Question 231

The AIRB - Alberta, Insurance, Rating, Board grid calculator has a left hand side with numbers, what does this side do?

Answer 231

left hand side minimum rate we have to charge before a client goes to facility association

Question 232

what sections does the grid apply to? How does it fluctuate

Answer 232

only to section A&B ONLY and as drivers gain experience their premiums will go down

Question 233

Where do inexperienced drivers start on the Grid

Answer 233

Inexperienced drivers, someone who has just taken drivers training starts at what Grid step level -2 -10% . Each year she receives a 5% discount to a maximum of %50 discount

Question 234

On the grid how many steps up does each at fault accident move up

Answer 234

5 steps

Question 235

1.Which of the following advocates on behalf of insurance brokers and consumers, supports and elevates the broker profession, and promotes a vibrant and sustainable broker distribution channel, having 11 members in their association? • Insurance Brokers Association of Canada (IBAC) • Insurance Institute of Canada (IIC) • Chartered Insurance Professional (CIP) • Property and Casualty Insurance Compensation Corporation (PACICC)

Answer 235

• Insurance Brokers Association of Canada (IBAC)

Question 236

2.Which of the following organizations is the national voice of over 38,000 Property and Casualty insurance brokers, representing and advocating for the best interest of insurance brokers and consumers in Canada? • Insurance Industry Leaders Association (IILD) • Insurance Brokers Association of Canada (IBAC) • Insurance Institute of Canada ( IIC ) • Insurance Bureau of Canada (IBC)

Answer 236

Insurance Brokers Association of Canada (IBAC)

Question 237

``` 3.Which educational designation is the highest level of Education one can achieve in the Canadian Property and Casualty insurance industry? • FCIP • Advanced CIP • CAIB • CMGA ```

Answer 237

FCIP

Question 238

``` .When a client makes a claim that is not covered, whose responsibility is it to tell them if it is not covered? • Underwriter • Broker • Adjuster • All of the above ```

Answer 238

• Adjuster

Question 239

If a Managing General Agent completes more CE credits in one year, how many can they carry forward to the following licensing annum? • 15hours is the maximum carry-forward and the term in Alberta is July 1 - July 1 • 7.5 hours is the maximum carry-forward and the term in Alberta is July 1 - July 1 • 7.5 hours is the maximum carry-forward and the term in Alberta is July 1 - June 30 • 15 hours is the maximum carry-forward and the term commences the date you originally passed AIC examination

Answer 239

7.5 hours is the maximum carry-forward and the term in Alberta is July 1 - June 30

Question 240

*PERSONAL INFORMATION PRIVACY ACT (PIPA) A. a FEDERAL STATURE THAT APPLIES TO PERSONAL INFO B. APPLIES TO PRIVATE COMMERCIAL ORGANIZATIONS WITH THE PROVINCE OF ALBERTA C. STES OUR 10 PRIVACY PROTECTINO PRINCIPLES THAT MUST BE FOLLOWED D. GOVERNS HOW PUBLIC BODIES MAY COLLECT, USE OR DISCLOSE PERSONAL INFO

Answer 240

B. APPLIES TO PRIVATE COMMERCIAL ORGANIZATIONS WITH THE PROVINCE OF ALBERTA

Question 241

* Privacy laws in effect to provide consumers with confidence that their personal information will be kept confidential. A clients financial history reveals a bankruptcy filing which took place seven years prior. You must not share this info with a. Underwriter b. Others in your office c. the marketing broker in your office helping you place coverage d. The customer service rep in your office assisting in arranging adequate insurance coverage for a client

Answer 241

b. Others in your office

Question 242

PIPEDA states that when private info is gathered for a particular purpose it can only be used for that purpose a) Unless you have obtained consent from your client for any other purpose b) Unless required by a court to disclose this info c) With some expectations d) All of the above

Answer 242

d) All of the above

Question 243

You are a broker and play sports. You quoted a newcomer to your city in February and obtained all of her personal info including address and phone number. You clicked with that prospect, but she did not buy insurance forum you. It is now may and you need some players for your slo pitch team. She mentioned she likes playing slo pitch. Can you use the info obtained through your quote to contact this person to invite her to play. a. No she is not a client b. No info gained for business purposes can only be used for bus purposes c. Yes she willingly gave you her number for a quote d. Yes you taked ports so this makes it legitimate to call her for personal reasons

Answer 243

No info gained for business purposes can only be used for bus purposes

Question 244

*What does underwriting laboratories of Canada do A underwrites tests for life insurance B underwrites swab test C approve safety equipment

Answer 244

C approve safety equipment

Question 245

CSIO

Answer 245

The Center of Studies insurance operations – when we went to electronic systems this company appred the computer systems

Question 246

who manages the arbitration process in Alberta

Answer 246

CICMA- Canadian Insurance Claims managers association

Question 247

check AIC HELP TAB

Answer 247

CHECK THE AIC HELP TAB

Question 248

E&O’S IN ALBERTA WHAT IS THE The minimum number required ?

Answer 248

The minimum is 500k per claim with a 2mil aggerate

Question 249

READ THE IBAA ABOUT US

Answer 249

READ THE IBAA ABOUT US

Question 250

What does the IBAA/IBAC DO?

Answer 250

Liaze with the government of Canada IBAC IS A NATIONAL ORG THAT PREPRESENT THE COLLECTIVE INTRESTS OF MEMBERS - 11

Question 251

what DOES Wett wood energy technical training provide

Answer 251

They certify s wood fire places

Question 252

Explain the Facility association aka residual market

Answer 252

Facility Association does not exist in the government provinces – the purpose is to administer auto rates in a residual market

Question 253

what does the PACICC do?

Answer 253

It provides Insurance if Incase the insurer is BANKRUPT and the insured has a claim

Question 254

What is the limit of PACICC’S Auto and commercial insurance policies ? Does a deductible apply? Will they return any unearned premiums?

Answer 254

500k per policy. Policy deductibles are applied to the total amount of the insured loss. PACICC will also refund 70% of the unearned (unexpired) portion of your premium calculated from the date of the wind up order

Question 255

Soft vs Hard Market

Answer 255

A Hard Market Occurs when an insurance company has poor underwriting results. (Less income is received in premiums then is paid out in claims. Rates need to be adjusted to improve the financial performance. a hard market affects the market as a whole. insurers will tighten their underwiring In a hard market it is more difficult for agents/brokers to obtain competitive terms for their clients. Soft market - When things are good, lower price, easier to place business. When things get tough it's hard - Soft market is when the underwriting results are positive, companies are competitive and making money. More companies are wiling to write that class of business and naturally the rates and premiums reduce

Question 256

1.Which organization manages the Arbitration Agreement in Canada? • Canadian Insurance Claims Managers Association • Insurance Bureau of Canada • Insurance Institute of Canada

Answer 256

• Canadian Insurance Claims Managers Association

Question 257

2.Which organization is involved in broker distribution channels improving and implementation of technology standards including e-signatures, firewalls, proof of insurance delivery? • Centre for Study of Insurance Operations • Underwriter Laboratory of Canada • Insurance Institute of Canada • Alberta Insurance Council

Answer 257

Centre for Study of Insurance Operations

Question 258

``` provided to a new driver with a drivers training approved certificate? • Grid step -5 discounted rate • Grid step -2 discounted rate • Grid step +2 surcharged rate • Grid step +5 surcharged rate ```

Answer 258

• Grid step -2 discounted rate

Question 259

4.Alberta Insurance Rating Board instituted GRID rating in October 2004 to avoid Brokers overpopulating Facility Association and residual markets. When the person has taken drivers training and is a new driver, they start at GRID step -2. How do you explain this to the client? * This provides a 10% reduction in premiums, but they move to 15% discount the following year if they remain claims free * This provides a 10% reduction in premiums, but they move to 20% discount the following year if they remain claims free * This provides a 10% reduction in premiums, and they remain at the 10% discount (Grid step -2) until they have earned that driving experience, and move to further reduction on the next renewal

Answer 259

This provides a 10% reduction in premiums, and they remain at the 10% discount (Grid step -2) until they have earned that driving experience, and move to further reduction on the next renewal

Question 260

5.The administration of Canadian Inter-Company Arbitration Agreement is provided by which of these associations? • Alberta Insurance Council • Canadian Association of Direct Relationship Insurers • Canadian Insurance Claims Managers Association Insurance Brokers Association of Canada

Answer 260

Canadian Insurance Claims Managers Association

Question 261

6.The Insurance Bureau of Canada administers the Intercompany Claims Settlement Agreement which deals with claims situations not requiring Arbitration. IBC also performs other functions. Which of the following is NOT an activity that the Insurance Bureau of Canada is involved? • Development of advisory model policy wordings for use in the industry • Claims standards with high standard of ethics and claims arbitration • Insurance crime related investigation • Advocating industry positions with government, members, and other stakeholders

Answer 261

• Advocating industry positions with government, members, and other stakeholders

Question 262

7.This is a new topic and not in the videos, but if you visit Institute for Catastrophic Loss Reduction website, this organization specializes in developing programs to avoid catastrophic losses, which are very expensive to insure. It is a not-for profit organization run from Western University in London Ontario. Here is what they focus on: • Development of cost-effective ways to build stronger structures to withstand severe weather • Risk management practices to reduce financial impact of catastrophic natural disasters • Promotes consumer practices to prevent and reduce losses • All of the above

Answer 262

• All of the above

Question 263

``` Agency Bill or sometimes called Broker Bill allows the Broker to pay the premiums for their client, and the client receives an invoice from the Broker instead directly from the insurance company. This is a major liability for the Broker if not properly managed from an accounting standpoint, and can create receivables. The other form of invoicing a client, when the insured pays monthly or annually directly to the insurer is called: • Direct Bill • Insurer Bill • Monthly pay • Electronic Funds Transfer ```

Answer 263

• Direct Bill

Question 264

9.Lloyds of London is: • Not an insurer, but a marketplace with experienced and specialized Brokers on staff • Not an insurer, but a marketplace with experienced and specialized Producers on staff • An insurer with experienced and specialized Brokers on staff • Not an insurer, but a marketplace with experienced and specialized Underwriters on staff

Answer 264

• Not an insurer, but a marketplace with experienced and specialized Underwriters on staff

Question 265

10.Brokers and Agents normally have two bank accounts for their business, an operating account and a trust account. The Insurance Act requires this. A trust account is one used to deposit: • premiums collected to pay insurers for policies issued • commissions earned • contingent profit commissions earned • earned premiums only

Answer 265

• premiums collected to pay insurers for policies issued

Question 266

``` 11.Insurance Brokers Association of Alberta is designed specifically to advocate to Government on behalf of Brokers (not Direct Writers) and to help them achieve their goals. Besides assisting Brokers by bringing forward key issues to influence change, what other roles does IBAA accomplish? • Licensing and CE accredited courses • CIP Designation • Networking events with Brokers • A&C ```

Answer 266

``` 11.Insurance Brokers Association of Alberta is designed specifically to advocate to Government on behalf of Brokers (not Direct Writers) and to help them achieve their goals. Besides assisting Brokers by bringing forward key issues to influence change, what other roles does IBAA accomplish? • Licensing and CE accredited courses • CIP Designation • Networking events with Brokers • A&C ```

Question 267

13.On a Commercial Crime insurance policy, employee dishonesty HINT • Is on a discovery basis • Is also known as fidelity insurance • Protects against employee dishonesty, whether acting alone or in collusion with others • All of the above statements are true

Answer 267

all of the above

Question 268

``` 14.Betty Smith invited several friends over to enjoy her birthday celebration. She purchased several bottles of alcohol from a liquor store. After a friend has a drink of vodka, shards of glass are found in the bottle. The friend suffered severe cuts and internal injuries, requiring surgery. The liquor store was found liable. This is an example of __________ liability: • operations • products • contractual • premises ```

Answer 268

products

Question 269

A Conflict of Interest position means a situation where an intermediary • Is charging an excessive rate of interest on a payment plan • Is looking after the best interest of the client or other stakeholders • As an incentive to act other than in the best interest of the client • Commits a civil wrong. other than breach of contract

Answer 269

As an incentive to act other than in the best interest of the client

Question 270

16.Statutory Conditions of all Property, Auto and Accident Sickness policies contain four situations where the insurer must remain on risk, and in fact cannot cancel a policy. What are these ?HINT • Material misrepresentation, fraud, arson and non-disclosure • Title by succession, death, proceedings under bankruptcy and operation of law • Misrepresentation, bankruptcy, death and arson creating operation of law • There are no situations where the insurer must remain on risk

Answer 270

Title by succession, death, proceedings under bankruptcy and operation of law

Question 271

An insured property is covered by two separate commercial policies placed with two different insurers. Insurer A’s policy has a limit of 100k and insurer B’s policy has a limit of 200k. the insured suffers an insurable loss of 230k. Assuming no deductibles apply how much will a. Insurer A will pay $100,000 insurer b will pay $130,000 b. Insurer A will pay $100,000 Insurer B will pay $200.00 c. Insurer A will pay $76,659 Insurer B will pay $153.341 d. Neither Insurer will pay, two policies on the same property are prohibited

Answer 271

c. Insurer A will pay $76,659 Insurer B will pay $153.341

Question 272

What does accident sickness include 3

Answer 272

Including Travel Insurance Health & Disability Death and Dismemberment

Question 273

Which insurance policy contain statutory conditions A. Auto, life and disability policies B. Auto, life insurance and A&S policies C. Auto, property policies and A&S policies D. Liability policies

Answer 273

C. Auto, property policies and A&S policies

Question 274

What insurance policy types do NOT contain statutory conditions a. Auto Policies b. Liability policies c. Property Policies d. Accident and Sickness policies

Answer 274

b. Liability policies

Question 275

Dr. House is very wealthy, earning $600,000 per annum as a surgeon. Given the opportunity to sell him the very best policy which would you sell? a. Any occupation b. Regular occupation with an extended benefits period c. Any occupation with an extended benefit period e. Own occupation extended benefits

Answer 275

e. Own occupation extended benefits

Question 276

wHAT TYPE OF INSURANCE IS GHIP what does GHIP stand for

Answer 276

- TRAVEL INSURANCE - government health insurance plans - they vary per province

Question 277

WHAT DO TRAVEL HEALTH PLANS COVER?

Answer 277

- It covers repatriation costs – the cost TO move back to Canada if the insured is totally disabled - Basic travel policies cover transfers to hospitals any required travel by a family member or companion to get translation

Question 278

what IS THE SUCCESSION OF PAYMENT IN A TRAVEL HEALTH PLAN

Answer 278

- 1st payor – Government Plans - 2nd Payor: Group Insurance - 3rd Payor: Individually Purchased plan Travel Health Insurance does not replace insurance provided by another plan

Question 279

A family plan is for one person and includes a spouse, dependent relatives, dependent relatives and defined as

Answer 279

**unmarried children under the age of 21 or under 25 if attending school on a full time basis

Question 280

What are the exclusions on a travel policy

Answer 280

Exclusions to travel medical - Pre existing conditions - AIDS - Expected Illness - War - Dangerous activities - Travel within 8 weeks of expected date of pregnancy after 32 weeks - Committing criminal acts

Question 281

When is disability insurance paid?

Answer 281

weekly aka weekly indemnity

Question 282

**3 Definitions of disability ANY OCCUPATIONS REGULAR OCCUPATIONS OWN OCCUPATONS

Answer 282

Any Occupations – you can’t do any other jobs Regular Occupation – Can receive the difference between the disability to the regular salary Own Occupation Own occupations: This person can receive both the disability benefits from previous employment plus their entire wage earnings from their new career. It is there for the most expensive - With this definition a disabled person can actually received more then they were previously making before disabled

Question 283

Contract aka Treaty Insurance is ?? It's arranged what basis

Answer 283

Contract aka Treaty Insurance – Reinsurance arranged on a Contract Basis. IT's called a reinsurance

Question 284

WHEN IS Facultative Reinsurance Arranged ?

Answer 284

Reinsurance arranged on a case by case or risk by risk basis, need to negotiate

Question 285

WHAT DOES IT MEAN TO Cede A BUISNESS

Answer 285

Cede – Cedeing the business is also Facultative Reinsurance.

Question 286

WHAT IS Retrocession

Answer 286

When an insurance company places reinsurance excess liability with another reinsurer this is a session or cede

Question 287

When the reinsurer reaches out for help what is this called ?

Answer 287

retrocession

Question 288

32. A “physical hazard” is: a. ( ) A type of peril b. ( ) The same as a moral hazard c. ( ) A physical feature of a risk which may give rise to a loss d. ( ) The possibility of a loss due to the character of the Insured

Answer 288

c. ( ) A physical feature of a risk which may give rise to a loss

Question 289

70. Under a Homeowner’s Policy, the Optional Loss Settlement clauses can be invoked by: a. ( ) The Insurer b. ( ) The mortgagee c. ( ) The Insured d. ( ) The broker e. ( ) All of the above

Answer 289

a. ( ) The Insurer

Question 290

106. Conditions indicating indifference to moral hazard include: a. ( ) Statutory condition, indifference to loss, moral character b. ( ) Financial condition, indifference to gain, moral character c. ( ) Perils that could cause loss d. ( ) Financial condition, indifference to loss, moral character

Answer 290

d. ( ) Financial condition, indifference to loss, moral character

Question 291

107. Insured’s causing unintentional damage to the property of others will generally be covered by their liability policy. Third party property damage includes: a. ( ) Physical injury to tangible property; all resulting loss of use of that property b. ( ) Physical injury to tangible assets, loss of use of those assets c. ( ) Physical injury to tangible property, and resultant loss of use of that property d. ( ) Intangible property, resulting loss of use of that property

Answer 291

a. ( ) Physical injury to tangible property; all resulting loss of use of that property