Chapter 10- Industry organization: The Customer Flashcards
What is the purpose of the Facility Association?
A. Ensure immediate availability of insurance to all owners and operators of automobiles
B. Act as a not-for-profit association to develop and maintain driver education facilities
C. Provide a level of recovery for policyholders and claimants charged with impaired driving
D. Negotiate fair wordings for all automobile insurers and act as a lobbyist with the federal government
A. Ensure immediate availability of insurance to all owners and operators of automobiles
All drivers must be able to obtain insurance. To ensure this, the insurance industry proposed to
the governments concerned that they establish a pooling arrangement whereby all “high-risk” drivers could be underwritten in a common pool and the profits or losses of the pool would be shared by all automobile insurers in the province or territory. This pooling arrangement is known as Facility Association.
Which of the following is a main duty of the Insurance Institute of Canada?
A. Supervising foreign companies
B. Publishing underwriting manuals used by most Canadian insurers
C. Acting as an organization of insurers to lobby the federal government to negotiate fair policy wordings for automobile insurers
D. Conducting national examinations for education programs for property and casualty (P&C) insurance, grading the entries, and awarding diplomas to graduates
D. Conducting national examinations for education programs for property and casualty (P&C) insurance, grading the entries and awarding diplomas to graduates
Conducting national examinations for education programs for property and casualty (P&C) insurance, grading the entries, and awarding diplomas to graduates is one of the responsibilities of the Insurance Institute of Canada
Which statement about Underwriters Laboratories of Canada (ULC) is true?
A. Underwriters Laboratories of Canada operates a certification service for the examination, testing, and certification of devices, construction materials, and services to determine their effect on fire, accident, and property hazards.
B. Underwriters Laboratories of Canada is an organization that evolved from being membership-based to user-pay.
C. Underwriters Laboratories of Canada’s objective is to provide a central forum for free discussion about the evolution of insurance in technology.
D. Underwriters Laboratories of Canada is a not-for-profit joint venture between the Insurance Brokers Association of Canada and the majority of independent broker insurance companies, as well as system (computer) vendors.
A. Underwriters Laboratories of Canada operates a certification service for the examination, testing, and certification of devices, construction materials, and services to determine their effect on fire, accident, and property hazards.
Underwriters Laboratories of Canada is a not-for-profit organization that operates laboratories and certification service for the examination, testing, and certification of devices, construction materials, and services to determine their effect on fire, accident, and property hazards
Which statement about the Insurance Brokers Association of Canada (IBAC) is true?
A. It is a not-for-profit joint venture between the Insurance Brokers Association of Canada and the majority of independent broker insurance companies, as well as system (computer) vendors
B. Its objective is to provide a central forum for free discussion about the evolution of insurance in technology.
C. It is the national body of Canada’s organized brokers.
D. It was formed in 1952, by the existing provincial institutes in British Columbia, Manitoba, Ontario, and Quebec.
C. It is the national body of Canada’s organized brokers.
The Insurance Brokers Association of Canada (IBAC) is a not-for-profit trade association that is the national body of Canada’s organized brokers
What is the ability to provide a full range of insurance protection to clients known as?
A. Utmost good faith
B. Capacity
C. Materiality
D. Claims service
B. Capacity
Capacity is the ability to provide a full range of insurance protection to clients
In cases where a client has issues or concerns that cannot be resolved by the broker, the client has the option to approach which of the following?
A. Ombudsman
B. Insuring company
C. Consumer Information Centre
D. All of the above
D. All of the above
Occasionally, clients may have to approach other sources of assistance to resolve their
concerns. These include the (1) insurer’s complaint-handling protocol, (2) ombudsman, and (3) Consumer Information Centre.
Which of the following is a true statement?
A. Insurance consumers do not have the right to complain, since automobile insurance is required by law.
B. After an insurer issues a final position letter, claims problems will be referred to the provincial or territorial superintendent of insurance.
C. Providing credit is a function of brokers.
D. Insurance intermediaries are the link between the clients purchasing coverage and the insurers providing the coverage.
D. Insurance intermediaries are the link between the clients purchasing coverage and the insurers providing the coverage.
Insurance intermediaries are the link between the clients purchasing coverage and the insurers providing the coverage. The rest of the statements are incorrect
What is the name of the payment method where the insurance company invoices the client directly?
A. Agency bill
B. Insured bill
C. Client bill
D. Direct bill
D. Direct bill
Most if not all insurers now provide their brokers with the option of direct-bill facilities. This
means the insurer invoices the clients, and they pay insurers directly.
How can active listening be practiced in a telephone conversation?
A. By monitoring tone, vocabulary, and rate of speech.
B. By monitoring visual cues.
C. By using matching and mirroring.
D. By monitoring body posture and rate of speech.
A. By monitoring tone, vocabulary, and rate of speech.
Rationale: In telephone communication there are no visual cues to read, so adjusters must rely chiefly on tone, vocabulary, and rate of speech to convey cues about intention and meaning.
While delivering bad news, what must adjusters avoid doing?
A. Letting the insured know when the insurance company has a specific process to be followed for claim denials
B. Making assumptions or presumptions about coverage
C. Providing the insured with a warning when negative news is coming
D. Beginning with the good news when there is both good and bad news
B. Making assumptions or presumptions about coverage
Adjusters must deliver bad news with empathy but should not make any assumptions or presumptions about coverage to the insured
Outline key functions, activities, and services of the Insurance Bureau of Canada.
Advocate industry positions with consumers, government, members, and other stakeholders
• Identify and monitor issues, develop policy positions, and respond to legal developments
• Stay on top of issues of strategic importance to the industry
• Issues management—including policy development, public affairs and marketing, legal, and regional offices
• Investigative services—including insurance crime-related investigations, auto theft and loss recovery services, information exchange, public affairs and marketing, and legal as they pertain to investigative services
• Insurance information—including access to web-based business applications and other information related to automobile insurance in Canada
• Government automobile insurers also participate with private insurers in IBC’s vehicle information programs
Describe the role of the Facility Association.
All drivers must be able to obtain insurance—while most drivers are served adequately by the insurance system, problems are experienced by a minority in obtaining insurance, particularly those identified as “high risk” from an underwriting standpoint
• To ensure that they will be able to access insurance, the insurance industry developed a pooling
arrangement whereby all high-risk drivers could be underwritten in a common pool (the Facility
Association)
• The profits or losses of the pool are shared by all automobile insurers in the province or territory where it is operating
• Due to the loss history of the drivers in the Facility Association pool, they will tend to have higher than the industry average claims expectancy
• So the general average of the rate of premium charged for Facility Association coverage will be greater than those premiums available in the regular market.
Under the Facility Association pooling arrangement, several companies become servicing carriers and are available to those drivers who are experiencing difficulty in obtaining insurance
• All agents and brokers in the province or territory have one of these servicing carriers to underwrite and provide all the necessary insurance services, including claims service, for their high-risk business
• The premiums are higher because they reflect the loss experience of high-risk drivers
Outline the model of acceptable practices for loss adjusters.
Acceptable practices for loss adjusters (any five of the following)
• Insureds and claimants are entitled to receive courteous, fair, and objective treatment promptly from knowledgeable adjusters
• A copy of a written statement should be made available without charge to the statement maker
• Adjusters do not provide legal advice or deal with a claimant or insured who is represented by legal counsel unless permission by legal counsel has been obtained
• Relevant insurance coverage must be explained to the insured
• Written consent is required to obtain medical information or records
• Adjusters must identify themselves to claimants and insureds and, if asked, identify their principals
How do you know if a broker or agent is providing good customer service?
Good client service by agents and brokers
• They have a reputation as a dependable source of insurance advice
• They have adequate capacity and range of coverages
• They have accurate and adequate accounting and office methods
• They demonstrate good handling of claims
• They handle complaints appropriately
What can I do if I’m not happy with how my insurance company is dealing with my case?
Options for resolving concerns
Options for resolving concerns
• First, you can engage with your own broker who may be able to assist you in resolving issues
• You can also deal directly with the insurer through its own system of complaint handling
• In some jurisdictions, an ombudsman employed by the insurer or by the insurance regulator is available to answer insurance queries or to help resolve claims complaints
• Insurance Bureau of Canada maintains a national telephone hotline, the Consumer Information Centre, to answer consumer questions
• Finally, claims problems that are not resolved are referred to the General Insurance Ombudservice (GIO) after the insurer issues a final position letter
