Test 2
Ontario Insurance Brokers Quiz
Test your knowledge on important regulations, principles, and practices related to insurance brokerage in Ontario. This comprehensive quiz covers various topics including the Registered Insurance Brokers Act, policy details, and more.
Whether you’re preparing for a certification, brushing up your knowledge, or simply testing your skills, this quiz is designed for you!
The Registered Insurance Brokers (RIB) Act of Ontario requires an individual to be registered if they:
Are licensed under the Insurance Act to write business on behalf of a single insurer.
Advise their friends to buy insurance from their insurance broker.
Negotiate an insurance contract on behalf of another and receive compensation.
Are employees who negotiate insurance or other services on behalf of their employer and does not receive a commission, but a salary.
A real estate broker in your city has arranged to pass you leads whenever they sell a home. In return, they ask you to provide some form of a financial rebate on their policy. You consult the RIB Act and realize that:
Contrary to popular belief you can reduce the premium, but only up to the amount of your commission.
Payments of finder’s fees are allowed, but only to persons who are registered as insurance intermediaries.
You cannot pay him anything directly, but you can pay a finder’s fee to the real estate firm that equals the first year’s premium.
Cash exchanges are not permitted; however, there is nothing to prohibit you from purchasing them a valuable gift, for their assistance.
As an insurance broker “restricted to act under supervision”.
You may sell and solicit insurance and provide consultation to the general public only within the community where your office is located.
You may solicit insurance only from individuals who call or visit your brokerage.
You may not control a trust account unless under the supervision of the designated individual.
You may not act as a sole proprietor, control trust funds, or function as a designated individual.
As per section 14 of the Ontario Regulation 991 “code of conduct,” a member should not:
Encourage public respect for and try to improve the practice of the broker’s vocation.
Use any practice or conduct that resulting in the reasonable delay of a claim.
Act as an insurance agent.
Be both candid and honest when advising a client.
Which one (1) of the following forms of coverage could protect your client against a loss due to the dishonesty of an employee?
A hold-up policy.
A burglary policy.
A fidelity bond.
A theft policy.
The basic fire policy
Usually covers fire, lightning, and specified types of explosion.
Is required by law to cover fire, windstorm, and lightning.
Covers fire, explosion, and windstorm.
Is required by law to cover at least fire, lightning, and all explosions.
You were on a relaxing two week holiday staying at a friend's apartment in Hawaii. While you were cooking dinner one evening, a TV program caught your attention. Behind you in the kitchen, a frying pan with oil splatters onto the element of the stove. The oil caught fire and caused damage to your friend's apartment. Your friend tells you he has insurance. Six months later, you are served with a writ holding you responsible for $60,000 of damage because of the fire. You call your friend and are told that his insurance company insisted on suing you. This is known as:
Negligence
Contribution.
Recoverable salvage.
Subrogation
Actual cash value most clearly means (choose the most correct):
The settlement on a replacement cost basis.
Replacement cost less accumulated depreciation that has been agreed upon in advance.
Replacement cost less accumulated depreciation or plus appreciation that includes consideration of likely resale value, degree of deterioration, obsolescence, age and general condition of the property involved.
The actual cost of replacing/ repairing the damaged or destroyed property at the time it was insured.
Co-insurance is a clause that:
Is in the homeowner/condo/tenant policy.
Encourages insured to carry adequate amounts of insurance.
Limits the amount payable for a loss when insured to value.
Is in the Insurance Act of the Province of Ontario.
A peril is an event that causes a loss to occur. Which of the following is not a peril?
Fire.
Windstorm.
Slippery stairs.
Vandalism.
The minimum limit of third party liability in Ontario is:
$200,000.
$100,000.
$300,000.
$50,000.
If a broker knowingly does not advise the insurer of the client’s previous losses when required to do so, he has violated an essential principle of the insurance contract. The principle is:
Legality of object of the contract.
Utmost good faith.
Insurable interest.
Indemnity.
Which one is a material change in fact?
The insured fails to advise the insurer that their son is home for one week from university.
The mortgagee does not inform the insurer that the mortgage has been fully paid.
The insured changes the main floor of their home into a restaurant and cooking school but does not notify the insurer.
The insured requests an estimate on upgrading their homes wiring and plumbing system and fail to notify the insurer.
A bailee is one who
Owns a certain amount of property.
Posts bail to get one out jail.
Has someone else’s property in their possession for safekeeping or repairs.
Stores their possessions with someone else for one reason or another.
Which of the following statements is correct?
Most policies cover loss or damage to the insured’s property, whereas liability policies include insured and third party property.
Liability policies protect the insured by paying damages for which he is legally liable.
Liability policies cover goodwill payments, which an insured might like to make to keep friends happy.
Payments are never made under a liability policy until a court judgment is received.
The insured has a loss. According to Statutory Conditions, when submitting the claim:
A police accident report should always be completed.
A proof of loss form should be completed as soon as possible.
An indemnity form should be completed.
A non-waiver agreement must be signed.
Following a policy being issued, a significant misrepresented fact on an application may cause the insurer to:
Deny a claim.
Deny liability.
Increase the amount of the deductible.
Void a policy.
Negligence is:
The failure to exercise the care that a reasonable person would take in a similar set of circumstances.
Behaving in a manner expected of a reasonable and prudent person.
Payment of insurance monies to a person injured by the insured persons.
Exercising rights under an insurance policy to recover money paid to a third party.
The Facility Association is:
A reinsurance pool for accompanying auto policy holders who desire particularly high liability limits.
An insurance pool subscribed to by all auto insurance companies who share the writing of risks that are not ordinarily written on the standard insurance market.
A group of insurance carriers who write business on auto owned by brokers and their staff.
The provincial government insurance office that is charged with the responsibility of accepting applications from auto owners who cannot get insurance anywhere else.
In the event of Home claim, how quickly must the insured notify the insurer:
Within 72 hours.
Within 48 hours.
Promptly.
Within 7 days or if unable to do so as soon as possible.
An insured owns a building valued at $200,000 and insures it for $140,000. The policy carries a 90% coinsurance clause. The building is damaged by fire to an extent of $50,000. How much of the loss will the insurer pay?
$43,754.
$50,000.
$35,000.
$38,888.
When an insurer cancels a policy they must:
Comply with the RIB Act.
Send back the insured's premium by priority post.
Comply with the statutory conditions of the policy.
Give back the short-rate portion of the premium.
A material fact is:
Something the client knows, but the insurer doesn't ask.
A fact that changes the insurer’s decision regarding coverage or premium.
A detail required to cancel a policy.
Information the broker must share with the mortgagee.
Business interruption insurance may be described as coverage that will protect the insured for:
The indirect loss of income that results when there is a shutdown of this business due to occurrence of a peril insured against and normal operations cannot be carried on.
Fire damage to finished good that the insured has manufactured and is in storage awaiting shipment.
Loss of business brought about by mismanagement and improper use of the insured's funds.
Interruptions in his operations due to labor disturbances.
A policy is considered a valued policy if its terms include which one (1) of the following?
It states that the object of insurance is valued at and insured for a stated amount.
It provides for replacement of the item irrespective of the sum insured.
It cannot be altered during its term except for adjustment for inflation.
It pays the actual cash value of an article regardless of cause of loss.
A building worth $250,000 is insured for $50,000 there is an 80% co-insurance clause. Fire damage amounts to $50,000. How much will the insured pay?
$12,500.
$50,000.
$40,000.
$37,500.
Which of the following does not have a fiduciary relationship with their clients?
Lawyers.
Convenience stores.
Banks.
Insurance companies.
Which of the following statement is true?
Mutual insurance companies are required to be RIBO licensed.
A joint stock company is a profit-making organization and is in effect owned by its shareholders.
Lloyd's is a type of mutual insurance company founded by John Lloyd in London, England.
A mutual insurance company does not rely on its policyholders for the money to operate its affairs.
Which of the following persons or organizations would not have an insurable interest in a piece of jewelry:
Executor of a will.
Tenant of an apartment that owns the ring.
A bailee.
The individual to whom that property has been promised in 5 years’ time.
The term “indemnity” is often used in insurance to describe situations where:
The insurer attempts to collect its loss from the individual(s) who caused the damage.
The insurer returns the unearned portion of the premium if the policy is cancelled.
The insured is placed in the same financial position they were in prior to the loss.
The amount of insurance is sufficient to meet co-insurance requirement.
A mortgage clause is needed when:
A mortgagee has financial interest in the insured's property and wishes to protect their position under the insurance contract.
The mortgage holder wishes to have higher insurance values than the policy presently carries.
The insured lends money to a third party and wishes to protect his interest.
The mortgage holder wishes to have comprehensive coverage, and the policy is written on a named perils form.
Risk is:
An insured peril.
Speculative in nature.
The uncertainty regarding a loss.
The same as a hazard.
Which of the following is correct:
Joint stock insurance companies are owned by policyholders.
A lessor is the person who leases the property from the lessee.
A lessee is the party to whom the property is leased.
Actual cash value means replacement cost of property.
A deductible clause in a residential policy
Does not apply to any item that is subject to special limits of insurance.
Specifies the amount that must be paid by the insured before an insurer will pay any expenses.
Is set out in the Statutory Conditions, under requirements after loss.
Is waived if the loss exceeds the deductible amount.
Following a loss, the insured must:
Notify the insurance company immediately. As soon as possible, deliver to the insurer, a proof of loss form. State the amount claimed, the interest of the insured and all others with insurable interest in the property. Give details of any other applicable insurance and if required, provide an inventory of undamaged property with documentation.
Notify the insurance company immediately. Within 30 days, deliver to the insurer, a proof of loss form. State the amount claimed, the interest of the insured and all others with insurable interest in the property. Give details of any other applicable insurance.
Notify the insurance company within 7 days. As soon as possible, deliver to the insurer, a proof of loss form. State the amount claimed, the interest of the insured and all others with insurable interest in the property. Give details of any other applicable insurance.
Notify the insurance company immediately. Within 45 days, deliver to the insurer, a form. State the amount claimed, the interest of the insured and all others with insurable interest in the property. Give details of any other applicable insurance and if required, provide an inventory of undamaged property with documentation.
If the insured is concerned that they may not be compensated adequately for a high priced possession, as the broker or insurer you may be able to offer a
Rider.
Valued contract.
Actual cash value.
Salvage.
What is the purpose of the "pair and set" clause in a Property insurance policy?
It obliges the insurer to pay the total loss if any part of a pair or set is lost or damaged.
It limits the liability of the insurer to not more than 25% of the total value of a pair or set that is lost or damaged.
It protects the insurer from having to pay for a total loss when only part of a pair or set is lost or damaged.
It warrants that earrings of precious or semi-precious stones are properly set in their mounting, failing which no loss will be paid by the insurer.
The general purpose of the Liability coverage section is to give the insured coverage for:
Injuries caused to others when the Insured is negligent.
Careless use of other individuals’ property the insured borrows.
Claims whether or not the insured is negligent.
Negligently caused damage to their personal property.
Which one (1) of the following amounts must be established when there is a co-insurance clause in a replacement cost policy?
The actual cash value of the property.
The replacement cost of the property.
The amount which could be obtained for the property in a sale.
The original cost of the property.
Which one of the following would be considered a robbery loss?
A bookkeeper set up false accounting records to divert funds into a personal off-shore bank account.
A masked man threatened your insured with a metal bar and ordered him to empty the cash register. He then ran off with all the money.
A customer taking merchandise from a store without paying for it.
A criminal smashed the glass in a jewelry display case, grabbed some of its 'contents and made off before he could be stopped.
A person insured under a property policy goes bankrupt and sustains a loss covered by the policy shortly afterwards. Which one (1) of the following statements describes the legal situation that exists?
The loss would be paid by the Trustee in Bankruptcy.
The insurer is liable to pay the loss to the trustee in bankruptcy.
The policy is void because the insured is bankrupt.
Bankruptcy is considered a material change to the risk, and the policy is therefore void.
An example of a physical hazard would best be described as:
A poor reputation.
Financial problems.
A past record of claims due to carelessness.
Slippery floors.
The Statutory Conditions under common law are:
Binding on the insurer but not on the insured.
Determined and designed by each individual insurer.
Required on all habitational policies.
Required on those policies insuring certain classes of risk.
A fire policy states it will pay the least of three amounts in case of a claim. Which of the following does not enter into this calculation
The actual cash value of the property.
The original cost of the property.
The insured’s interest in the property.
The policy limit.
What is the purpose of the Sue and Labour Clause in an insurance policy?
It requires the insurer to sue others who may be responsible for loss or damage to the insured property.
It requires the insurer to do some of the repair work to restore the property.
It requires the insured to take all reasonable steps in and about the recovery of the property in return for agreement that the insurer will contribute to the cost of doing so.
It permits the insurer to sue the insured for failure to maintain the property in good condition.
Is loss or damage caused by earthquake insurable?
Yes, it is one of the insured perils usually included in a property insurance policy.
No, it is not available under a property insurance policy.
No, it is not insurable because it is considered an "act of God".
Yes, it is a coverage which may be added to a property policy for an additional premium.
An insurance broker agreed to bind liability coverage, the premium for which the applicant promised to pay the following week. Before any payment was made, a claim was made by a third party. What special action, if any, would the insurer take?
Obtain a signed "Waiver of Subrogation" from the applicant/insured.
Deny the claim because no premium had been paid.
Respond to the claim in accordance with the coverage bound by the broker.
Investigate the claim but take no further action.
The Comprehensive Homeowner Policy:
Provides limited coverage on tools that pertain to a business but coverage is limited to $2,000 & only while the loss takes place on the insured’s premises.
Has no limitation on jewelry, provided the loss is caused by theft.
Will only pay the depreciated value on jewelry that is lost, unless the insured can substantiate the value of the lost item, in which case it will pay full value.
Will not pay for water damage caused by the accidental overflow of water from a sink, if it was the result of the Insured's carelessness.
Which of the following is correct about Additional Living Expenses coverage?
It will pay for all expenses incurred if you have to move out of your home because of one of the perils of the policy.
It will pay for all additional living expenses incurred if you have to move out of your home when your home is unfit to live in due to damage caused by one of the perils of the policy.
If you are forced out of your home for a reason other than an insured peril, you require special coverage for this.
This coverage is limited to two weeks.
A tenant negligently causes a fire that damages the apartment building. Under which policy is the building damage covered?
The Tenants Building Policy portion.
The Buildings Owners Liability Policy portion.
The Tenants Legal Liability Policy portion.
Each tenant would be assessed part of the cost of repairs.
Which one (1) of the following statements most accurately describes a special feature of the Condominium Unit Owners Comprehensive Policy?
It amends the Tenants Comprehensive policy to include that which is usual to a condominium.
It provides additional insurance protection for the Condominium Corporation in the event of an uninsured loss.
It provides additional coverage for damage to the owned condominium unit if the Condominium Corporation's insurance is inadequate or is not effective.
It adds the condominium corporation as an additional named insured with respect to liability coverage.
If an Insured goes south for a couple of months during the winter, which of the following is correct:
The Standard Homeowner will not pay for any losses after 30 days unless the Insured has arranged for someone to come in on a daily to ensure that the heating was being maintained.
Only the peril of Water escape may be affected by this situation.
Only the perils of Water escape, Vandalism & Glass may be affected by this situation.
Sewer back-up damage will only be covered for the first 30 days.
Burglars enter the insured's unlocked seasonal residence and steal some of its contents. Under the basic Seasonal Dwelling Fire & Extended Coverage form, the loss is:
Covered, subject to policy deductible.
Covered, only if forcible signs of entry are visible.
Covered, up to $500 only for building damage.
Not covered.
Which of the following, with regard to Section II Liability Coverage is correct:
The Voluntary Medical Payments Coverage will include coverage for an insured who falls and injures himself on the premises.
The Voluntary Payment for Property Coverage will protect a Homeowner up to a specified limit for unintentional damage he did to his neighbour’ s electric kettle when the insured was trying to repair it as a neighbourly favour.
The Legal Liability Coverage fully protects the insured for injury to others whether or not he/she is negligent and liable.
None of the above.
Your clients are tenants in a home and have a Tenants Comprehensive policy. They notify you that they have just purchased a new home. What should you do to change their insurance coverage when they move?
Transfer the entire policy to their new address, as they do not need any other coverage.
Get full details of the security arrangements and alarm systems in the new home. You will then be able to recommend how much fire and theft insurance they should carry.
Change their tenant’s policy with a home owner’s policy.
Cancel the entire policy. They no longer have any need for insurance, as the new home is covered under a Standard Mortgage Clause.
Your client has a Homeowners Comprehensive policy with a $300 deductible. They are planning to renovate their kitchen and begin purchase materials. Because they will be working during the allotted delivery times, they have arranged to have $3,000 worth of materials to be dropped off and stored at their friend’s home two blocks away. The friend’s garage is totally destroyed by an explosion. How much can they collect under their policy?
$3,000.
$2,700.
Nothing.
$2,500.
To what extent does Loss Assessment Coverage A2 in a Condominium Unit Owner’s Comprehensive policy cover an assessment against a unit owner?
Any covered assessment made by the Condominium Corporation up to $10,000 or the limit specified in the Unit Owners policy declarations.
Any covered assessment made by the Condominium Corporation as additional insurance up to the limit specified on Unit Improvements and Betterments.
Any assessment made by the Condominium Corporation as a contribution to cover the deductible in the Condominium Corporation's insurance.
Any assessment not exceeding $25,000 made with respect to any losses sustained by the Condominium Corporation.
In the case of a tenant package policy:
Tenant improvements and betterments may be added by endorsement for an additional premium.
The insured may apply up to $500 of the insurance to any type of damage caused other than the "insured" to any part of the landlord's building.
Coverage on outdoor trees and shrubs is included to a limit of 5% of the contents amount of insurance.
Dwelling means the portion of the building occupied by the insured as a private residence.
Which one of the following kinds of property does the Homeowners Comprehensive policy NOT automatically provide full cover?
An $8,000 medical scooter.
$5,000 of business tools stored in the garage.
Private structures on the insured’s premises.
Personal belongings temporarily stored in a warehouse for two (2) weeks.
Your client calls inquiring if they could provide their live in housekeeper some type of compensation for the loss of a finger while preparing the family meal. You advise them:
Compensation can be provided under Section II Coverage F – Voluntary Medical Payments.
Compensation can be provided under Section II Coverage E – Personal Liability.
Compensation can be provided under Section II Coverage H – Voluntary Compensation for Residence Employees.
There is no coverage available.
While playing near the freezer your son accidentally disconnects the electrical cord. You notice this the following week as you go to get something out for dinner. Which statement is true about Freezer Foods extended coverage?
No coverage exists.
The freezer is covered, but not the food.
Coverage exists up to the limit of the personal property coverage.
Coverage exists up to $2,000 (without deductible).
Up to 10 % of the amount of insurance on a Secondary Residence may be applied to insure detached private structures. If there are multiple detached private structures at varying price points, which of the following is true in the case of a loss to one of the detached private structures:
The full 10% of the allotted amount of insurance can be applied to the one loss.
If the cause of the loss is fire then the amount of insurance is determined by equally dividing the amount of insurance by the number of structures.
An amount equal to the value of the damaged structure without regard to the value of other structures will be paid.
The settlement is determined by dividing the amount of insurance in the proportions that the value of each structure has to the total value of all structures at the time of loss.
Your client buys their first outboard boat. They call to advise you that there has been an accident, and the damage to the motor will cost $1,000 to repair. He is wondering if his Homeowners policy would automatically cover the cost. What would be your response?
You will report the change to the insurer, assure him the policy covers the loss and ask him to submit the repair bill.
Since he had not paid the extra premium for the outboard motor, the policy will not cover.
The policy will cover only the proportion that the value of the equipment trade bears to the value of the new equipment.
The policy does not cover the loss since he did not report the new acquisition within 30 days.
Out of anger, Mrs. Smith's 13 year old son, Tommy, has just smashed in your front window with a baseball. Would section G-Voluntary Payment for Damage to Property of her homeowner’s policy cover this loss?
Yes, as Tommy is only a minor at 13years of age.
No, as Tommy is 13years of age.
Yes, if Tommy had just turned 13years old within the last 3 months.
No, only if Tommy had just turned 13years old within the last 30 days.
In the case of Condominiums, there are shared insurance responsibilities between the entire building & individual units. Which of the following is incorrect?
Fire damage to kitchen cabinets should be covered under the Condominium Corporation's policy unless the cabinets are upgrades from the original equipment.
If there is a loss to the common elements that result in an assessment against the unit owners, the loss will only be paid under the unit owner's loss assessment coverage, if the unit owner's policy provides coverage for the peril that caused the loss.
If there is inadequate coverage on the actual unit building, the loss assessment coverage may help out.
Condominium Corporation’s policies are inadequate & the unit owner should purchase coverages.
Three (3) of the following are policy conditions in a Travel Health Policy. Indicate the EXCEPTION.
Travel health policies do not cover eye glasses or contact lenses.
Senior citizens are only eligible for travel health insurance if they travel with an immediate family member.
Travel health policies do not cover medical treatment where the policy is sought specifically to obtain such treatment.
Benefits are not payable for elective surgery.
Which of the following is an example of pre-existing condition cause?
Pre-existing conditions are covered provided they received no change in treatment or medication of medical consultation within 90 days prior to departure.
All pre-existing conditions are covered at 80% above the provincial health plan when they require emergency hospitalization.
Specific conditions (cataracts, diabetes, cardiac conditions, and kidney conditions for example) are specifically listed as excluded from coverage.
All of the above.
A client comes to your office to arrange travel health insurance coverage. You explain that there are certain limitations. Which one of the following is to be a limitation?
Medical treatment for the birth of a child while traveling, pre-natal care or complications of the pregnancy or childbirth occurring within twelve weeks of the expected delivery date.
Air travel as a passage in a commercial aircraft licensed to carry passengers for hire.
The continuation of medical treatment while the insured is medically unfit to return to the country of residence after an emergency medical care.
Medical care for the birth of a child while traveling, pre-natal care or complications of the pregnancy or childbirth occurring within eight weeks of the expected delivery date.
Your client is a student who is going to Daytona Beach for a week and plans to go scuba diving. You should look for coverage with (choose the best answer):
No sports restrictions.
No pre-existing condition clauses.
No limitation or exclusions.
No maximum age limit.
You would be wise to point out which one (1) of the following features when discussing travel health insurance with anyone?
Senior citizens are eligible for travel health insurance regardless if accompanied by an immediate family member or not.
Travel health policies may limit coverage and benefits for sickness or injury that does not relate directly to an emergency.
Travel health policies do not provide Accidental Death benefits.
Benefits are payable for elective surgery procedures.
Which of the following is not true?
Auto Third Party Liability coverage will pay for emergency medical expenses even if the Insured is not legally liable.
Under Auto Third Party Liability coverage, in some circumstances, the Insured can choose his own lawyer.
The Insured agrees to repay the Insurer for any sums paid out when the Insurer has to pay by reason of the law, even though the Insured has violated the policy.
There are situations where the policy may pay over and above the policy limits on Auto Third Liability coverage.
If your client is injured in a car accident they:
May have to make the choice of accepting Accident Benefits compensation or launching a lawsuit.
Their Accident Benefits coverage will be reduced by the degree of being at fault.
Must go to their automobile insurer for Accident Benefits coverage when knocked down crossing the street, even though their vehicle was not involved in the accident.
Their Accident Benefits coverage will compensate them for pain & suffering, but not for economic loss.
As far as Section 7, Loss or Damage to vehicle of the OAP 1 policy is concerned:
If you have Specified Perils coverage, you will only be able to claim for Accident Benefits.
You will be unable to claim for damage to the vehicle regardless of fault.
Only All Perils coverage would be able to provide payment of claims to the percent you are at fault.
If you are 100% not at fault when your car is damaged, Loss or Damage coverage would not apply.
Unfortunately your client has had an automobile accident with an insured third party in Ontario. The bodily injuries caused to your client were above the threshold and they were allowed to sue. Receiving a court award or $1,300,000, what dollar amount basis is used to know when you are over the Threshold?
$200,000.
$500,000.
$1,000,000.
None of the above.
Who is the insured person on your OAP 1 under Accident Benefits?
An occupant in your auto while you are on vacation in Florida, the occupant has his own OAP1 policy.
Your sister in law while driving the vehicle that you lent her and who does not have a car of her own or any insurance.
A pedestrian struck by your vehicle while crossing between parked cars. The pedestrian is a driver on his parent's OAP1 Policy.
A friend from another province with similar Statutory Accident Benefits, who has an accident while driving your vehicle.
OPCF 20 – Coverage for Transportation Replacement provides coverage for which of the following:
All expenses incurred for the rental of a substitute auto due to the loss or damage to the insured auto no matter how caused.
Reasonable expenses incurred for rental of a substitute auto or costs of taxicabs and public transportation.
80% of all expenses incurred for the rental of a substitute auto.
Extends your automobile insurance coverage for a replacement vehicle, but does not cover expenses of renting the vehicle.
Bill, your client's nephew is a licensed driver from Alberta and is involved in an "at-fault” accident with your client's car. Bill had permission to drive and has his own insured automobile in Red Deer. A third party vehicle is injured in the accident, how will the claim be settled:
Your client's policy would pay, and the insurer would waive the right to subrogate against Bill's policy.
Bill's policy would pay only if permission is granted by the insurer for an out-of-province driver to operate the vehicle.
Your client's policy would pay, and the insurer would subrogate against Bill’s policy.
Bill’s policy would pay, and his insurer would subrogate against your client’s policy.
The Family Protection Endorsement OPCF 44 will:
Pay for injuries to the insured's passengers who do not have sufficient insurance.
Protect the insured and any eligible claimants in the auto from another party whose auto liability insurance is insufficient to cover their claims for damages.
Protect the insured in another jurisdiction where the insured's limits are inadequate to meet the jurisdiction’s requirements.
Pay for injuries suffered by the insured or his passengers as well as other property in the vehicle at the time of the accident.
Your insured with an existing OAP 1 Owners Policy purchases a snowmobile and advises you that his 14-year-old son will also operate the vehicle. What should you recommend to ensure there is coverage?
The son has to be 21 years old to operate the snowmobile.
Add OPCF 32—Motorized Recreational Vehicles Endorsement, to provide coverage for the underage operator.
There is no coverage while the son is driving as he is under 16 years of age and the coverage cannot be obtained.
Add OPCF 44R—Family Protection Endorsement, to cover any accident the son may have.
Your client with an OAP1 policy with Loss or Damage Coverage for Specified Perils calls to report that while traveling on the Walpole-Algonac Ferry between Ontario and USA, the ferry began to sink and some automobiles had to be jettisoned. They signed a waiver that stated if automobiles need to be jettisoned, the unaffected vehicle owners will contribute to the affected owners. They are wondering if:
Section 3 - Liability Coverage will cover their financial contribution to their assessed costs.
Section 7 – Loss or Damage Coverage will not cover their financial contribution to the assessed loss because they only have Specified Perils.
Section 7 – Loss or Damage Coverage and Section 3 – Liability Coverage combined together will cover their financial contribution to their assessed loss.
Section 7 – Loss or Damage Coverage will cover their financial contribution to the assessed loss.
After the theft of a vehicle, when does the Loss of Use section begin reimbursement?
24 hours after the theft has been reported to the insurer
24 hours after the theft has been reported to the police
48 hours after the theft has been reported to the insurer or to the police
72 hours after the theft has been reported to the insurer or to the police
If an insured is charged and convicted of impaired driving, with respect to Accident Benefits, which of the following would be paid?
Only medical and rehabilitation benefits would be paid.
All basic accident benefits, except weekly income benefits, non-earner benefits and compensation for other benefits would be paid.
All accident benefits would be paid.
Due to the fact that you were convicted of a criminal offense, nothing would be paid.
The recreational vehicle endorsement (OPCF 32) provides coverage for which of the following:
A motorcycle, snowmobile, and trail bike.
Motor scooter, snow plane and motorboat.
Snowmobile, trail bike, mini-cycle and dune buggy.
A motorcycle, snowmobile, trail bike and mini cycle.
Vehicle #1 collided with Vehicle #2. At the scene of the accident, it is determined that Vehicle #1 was completely at fault, but did not have insurance. Vehicle #2 was insured under an OAP 1. The owner of Vehicle #1 sustained severe bodily injuries. Vehicle #1's owner will obtain payment for medical, rehabilitation and attendant care from:
No one, as vehicle #1 does not have insurance.
The provincial government claim fund.
The insurance policy of vehicle #2.
The owner of vehicle #1 past expired policy.
On the OAP #1 policy, the uninsured automobile coverage would not respond in which of the following circumstances:
For the bodily injury of the insured when hit by an uninsured or unidentified driver of another automobile.
For property damage to the insured vehicle when hit by an uninsured and identified automobile.
For property damage to the insured vehicle that was hit and run in a parking lot.
For property damage caused by the insured’s spouse.
The OPF2 (OAP2) Drivers Policy:
Provides coverage for uninsured drivers who may use your car with your permission.
Provides coverage for someone who does not own a car, but borrows a car that may or may not have insurance on it.
Provides coverage when a person is renting a car while on vacation in Europe.
Provides coverage for a car owner who is driving passengers for compensation.
An insured requests that the limit of liability in his/her automobile policy O.A.P. 1 be reduced. What is the minimum amount he/she must carry under Ontario Law.
$100,000/$300,000 – Bodily Injury, $50,000 – Property Damage
$500,000 inclusive.
$200,000 inclusive.
$100,000 inclusive.
Your client has just purchased a new snowmobile. To properly insure it, you advise your client that you will:
Provide coverage by issuing an endorsement extending liability on the Homeowner's policy.
Issue an "all risk" policy specifically designed to insure recreational vehicles.
Cover it on an OAP 1.
Advise the client that the liability coverage under his current OAP 1 automatically extends to cover the snowmobile if it is less than 4500 kgs.
A potential client calls your office looking to purchase automobile insurance. When asking questions about their driving history they reveal that they have five (5) impaired driving convictions. Concerned about your loss ratio, what would be an appropriate response?
Advise them that your brokerage is unable to assist as there is a strict policy against providing coverage for individuals with prior impaired driving convictions.
Ask them to complete an application that you will process.
Demand a service fee before searching for an insurer.
Encourage them to visit a competitor who will provide them with a cheaper rate.
As the result of an automobile accident involving two registered and insured Ontario vehicles, both cars are damaged. The female driver is killed, and the male driver is uninjured. The uninjured driver is found to be 100% at fault for the accident. Which one (1) of the following statements is true?
All compensation for the deceased family will be paid by the uninjured driver’s policy.
No form of compensation will be available to the uninjured driver, as they are 100% at fault.
The insurer of the deceased’s vehicle will be entitled to subrogate against the uninjured driver for all payments made to the deceased’s family.
Initially, the deceased’s family receives compensation under her policy.
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