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RIBO > Study Points > Flashcards

Study Points Flashcards

1
Q

What is pure risk?

A

It involves the chance of financial loss with no chance of financial gain. Only pure risk is insurable.

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2
Q

If a contract of insurance contains clauses which allows the insurer to pay an amount that is less than that purchased by the insurer, what must be done?

A

It must have printed or stamped upon its face sheet in red ink the words: “This policy contains a clause that may limit the amount payable.”

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3
Q

What kind of legislation is the Insurance Act?

A

Provincial

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4
Q

What is the principal of

Indemnity?

A

To ensure that people receive the actual amount of their loss. No more, no less.

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5
Q

Give four examples of government insurance

A

CPP
EI
WSIB
OHIP

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6
Q

What is the purpose of insurance?

A

To pay for losses which are both accidental and future.

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7
Q

What provision in an agency/broker contract protects brokers from responsibility for the acts of an insurer?

A

A clause in which the insurance company indemnifies and holds the broker harmless against all civil liability.

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8
Q

Give three examples of stock insurance companies

A

Intact
Aviva
Travelers

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9
Q

What is property and casualty insurance?

A

All types of insurance other than life and health

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10
Q

What is a floater?

A

A floater is also known as a rider. The terms are used interchangeably. A floater is used to provide coverage for property having a high degree of mobility.

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11
Q

In what situation could a term or condition of a contract of insurance be waived by the insurer?

A

If the waiver is provided in writing and signed by a person authorized for that purpose.

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12
Q

What is the standard deductible for home, auto and tenant?

A

$500

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13
Q

Who owns a mutual company?

A

Its policyholders

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14
Q

What duties does the Superintendent of Insurance have?

A

They are an employee of FSCO. They:

1: supervise terms and conditions of insurance contracts
2: license insurers
3: monitor financial stability of provincially licensed insurers

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15
Q

When is an insurer not required to provide coverage on a fire policy?

A

1: application of heat
2: electrical currents
3: contamination by radioactive materials
4: war

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16
Q

in the Agency/Broker contract, what is a standard termination notice period?

A

Usually 90 days

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17
Q

Give three examples of direct writers

A

Belair
RBC Insurance
Desjardins

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18
Q

When are commissions fully earned?

A

Not until the expiry of the insurance policy. This is a broker’s fiduciary responsibility.

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19
Q

What is insurance all about?

A

Risk sharing

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20
Q

What is the role of the Property and Casualty Insurance Compensation Corporation (PACICC)?

A

When a bankruptcy occurs and claims cannot be paid, the Corporation pays all valid claims.

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21
Q

What was the original fire policy called?

A

The Insurance Act

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22
Q

What is an endorsement or rider?

A

An endorsement or rider acknowledges a change in the terms of a contract.

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23
Q

When are premiums fully earned?

A

Not until the expiry of the insurance contract. This is an insurer’s fiduciary duty.

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24
Q

What is concerned with taking measures to control frequency and severity of losses?

A

Risk control

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25
Q

What is the role of the Office of the Superintendent of Financial Institutions?

A

To provide federal licensing to insurers and to monitor their financial stability.

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26
Q

What’s the difference between direct writers and an agency system?

A

Direct writers only sell for one insurance company. Agency systems are small business owners and have ownership in their boom of business.

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27
Q

What year was the birth of fire insurance?

A

1666

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28
Q

What does the law require that insurance brokers exercise?

A

Reasonable skill, care and diligence

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29
Q

What is the most common cause of errors and omissions claims, accounting for 50% of them?

A

Inadequate coverage.

30
Q

Whose interest does an agent represent?

A

An insurer’s

31
Q

Whose interest does a broker represent?

A

Their client.

32
Q

What two things do Insurers have the right to expect of brokers?

A
  1. That they will tell the truth about the risks they submit

2. That they will not withhold or conceal important information

33
Q

What *one thing do property insurance policies insure?

A

Direct damage only.

34
Q

A condition imposed upon insureds requires what?

A

For them to do or not do something

35
Q

What are the two types of conditions?

A

Statutory conditions

Policy conditions

36
Q

If an insured has a trampoline or a golf cart, what could they be seen as having?

A

Liability exposures.

37
Q

What two types of optional additional coverage should you always add?

A

Sewer backup

Mass evacuation

38
Q

How many sections are there in the comprehensive homeowner, tenant condo package policy? What are they?

A

Section 1 - Property Coverages

Section 2 - Liability Coverage

Section 3 - Optional Additional Coverages

39
Q

Who is able to take legal action against an Insurer?

A

Only the person(s) named on the Coverage Summary Page

40
Q

Who does Coverage A - Dwelling Building apply to?

A

A Homeowner only

41
Q

Who does Coverage A1-A2-A3 apply to?

A

A condominium owner only.

42
Q

Under Coverage A, Dwelling Building, if there were materials and supplies intended for use in construction, alteration or repair of your dwelling or private structures, where must they be located?

A

On or adjacent to the premises

For theft only when the dwelling is completed and ready to be occupied.

43
Q

In a condominium, if no insurance covers the collective interest of the unit owners, or if the Condo Corp has no or inadequate insurance, what are you insured for under Coverage A1-A2-A3?

A

Up to $100,000 or the limit specified on the Declarations for Coverage A1

44
Q

Under Coverage A2 - Loss Assessment, what will be Insured and in what circumstances?

A

Up to $10,000 or the limit specified

Must be a peril insured by the policy

45
Q

Who does Coverage B - Detached Private Structures apply to?

A

A Homeowner only

46
Q

Who does Coverage C - Personal Property apply to?

A

Homeowner, tenant, condo owner

47
Q

Under Coverage C, can the uninsured personal property of others be included?

A

Yes

48
Q

Under Coverage C, where does your personal property have to be to be covered?

A

Anywhere in the world

49
Q

If your personal property is stored in a warehouse, how long is it covered and in what situation can that be extended?

A

30 days only but can be extended if requested in writing

50
Q

Under Coverage C, Is personal property normally kept at any other location you own, rent or occupy (like a secondary or seasonal residence) insured?

A

No

51
Q

Under Coverage C, Special Limits of Insurance, what amount is insured of books, tools and instruments pertaining to a business? And in what circumstance?

A

Up to $2000, but only while on your premises.

52
Q

If your personal property is stored in a warehouse, how long is it covered and in what situation can that be extended?

A

30 days only but can be extended if requested in writing

53
Q

Under Coverage C, where does your personal property have to be to be covered?

A

Anywhere in the world

54
Q

Under Coverage C, can the uninsured personal property of others be included?

A

Yes

55
Q

Who does Coverage C - Personal Property apply to?

A

Homeowner, tenant, condo owner

56
Q

Under Coverage C, Special Limits of Insurance, what amount is insured of books, tools and instruments pertaining to a business?

A

Up to $2000, but only while on your premises.

57
Q

If a civil authority prohibits access to a homeowner, tenant or condo owners’ premises as a direct result of damage to neighbouring premises by an insured peril or mass evacuation, how long will they be insured for additional living expenses?

A

Only two weeks

58
Q

If you have to remove property from your premises to protect it from loss or damage, how long is it insured for?

A

30 days or to the expiry of the policy.

59
Q

Under Extensions of Coverage, how much will an insurer pay for loss or damage to food in a freezer? And what two stipulations are there?

A

Up to $2000, without deductible
Must be a freezer located in your premises, and must be caused by mechanical breakdown or accidental interruption of electrical power on or off the premises

60
Q

What’s the most that will be paid under Credit or Debit Cards Coverage?

A

$2000, not subject to a deductible

61
Q

How much will be paid for information which leads to a conviction for arson or burglary?

A

$1000, without deductible

And this coverage may increase the amount otherwise applicable.

62
Q

What is the largest peril of loss?

A

Water

63
Q

Loss or damage caused by water is not insured unless what?

A

A - sudden and accidental escape of water from a watermain

B - sudden and accidental escape of water or steam from within a plumbing, heating, sprinkler or A/C system located inside your dwelling

C - sudden and accidental escape of water from a domestic water container located outside your dwelling

D - water which enters your dwelling through an opening which has been created suddenly and accidentally by a specified peril other than water damage.

64
Q

Is loss or damage caused by freezing during the usual heating season covered?

A

No

65
Q

How many consecutive days must you be away from your residence for a loss not to be covered?

A

4

66
Q

If a by-law, regulation or ordinance makes it impossible to repair or reinstate property as it was immediately prior to the loss, are you covered?

A

No. And Exclusion 25 does not cover demolition, debris or incremental costs.

67
Q

Is there a deductible in liability coverage?

A

No

68
Q

What will the insure pay in replacement cost for a detached private structure?

A

80% of the replacement cost of the damaged building

69
Q

Are musical instruments played for a fee insured?

A

Not unless the insurer has given written permission

70
Q

In Personal Articles Coverage, what does the letter V denote?

A

That the listed article is valued at and insured for the amount shown

RIBO (2 decks)

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