Chapter 3 Flashcards
Two different systems used to insure automobiles in Canada
- Private.
- Compulsory government insurers.
3 types of standard policy forms (SPF) that are used to insure vehicles
SPF NO. 1- owners form
SPF NO. 4 - standard garage automobile policy.
SPF NO. 6 - standard nonowned automobile policy.
Briefly explain what is meant by “standard” policy forms
Developed by insurance industry for all types of auto risks
3 provinces were compulsory government insurance plans exist
British Columbia
Manitoba
Saskatchewan
Identify 3 types of automobiles that can be insured under an SPF # 1
- Automobiles of the private passenger type
- Commercial vehicles, trucks delivery automobiles.
- Public automobiles such as buses and taxi cabs.
Minimum third-party liability limit required by law for private passenger vehicles in Manitoba
$200,000
Identify the additional hazard faced by insurers of public vehicles
When the number of passengers increase
3 sections of coverages available under the SPF # 1.
TPL
Accident benefits
Physical damage
Costs provided under section B - accident benefits
-Rehabilitation costs
-Reimbursement of reasonable medical expenses
-Funeral expenses
-Loss of income
-Death benefit
4 options available under section C - physical damage
- All perils.
- Collision or upset
- Comprehensive
- Specified perils.
SEF NO. 44 family protection endorsement.
Increase third party liability, limits available to victims of such accidents to the same limits as purchased under their own policy. When the claim is made, payment will be limited to the difference between the liability insurance limit of the insurance policy, and that carried by the motors at fault.
Identify the coverage limits and the maximum time provided for loss of use under section C - physical damage
20-30 dollars a day
Maximum 30 days
Identify the endorsement available for sections C if loss of use of theft is not adequate for the insureds need
SEF NO. 20 LOU ENDORSEMENT
-Rental of substitute
-Taxi cabs, or public means of transportation
Identify one use of an automobile, which is not deemed to be renting or leasing of the automobile to another
When a vehicle of an employee is used in the business of his employer for which he is paid
SEF NO. 5c
When a vehicle is leased to an individual or business for 30 days or less
SEF NO. 5
When a vehicle is leased by an individual or business for longer than 30 days
SPF NO. 8
To indemnify the lessor when the lessee fails to maintain the required insurance as stated in the lease.
SEF NO. 5d
To indemnify the lessor if the lessee sold the vehicle and disappeared
Identify two coverages which are automatically extended from the lessee’s own insurance to the rented vehicle if they wish to rent for less than 30 days
TPL
ACCIDENT BENEFITS
Identify the endorsement to be added to the individual lessee’s SPF NO. 1 to provide legal liability for damage to non-owned automobiles.
SEF NO. 27 legal liability for damage to non-owned automobiles endorsement.
Endorsement needed When a vehicle is used to carry explosives
SEF NO. 4a permission to carry explosives endorsement
Endorsement needed when the vehicle is used to carry radioactive material
SEF NO. 4b permission to carry radioactive material endorsement
Purpose of the SEF NO. 30 excluding operation of attached machinery endorsement.
Used by the insurer to exclude liability under section A - third-party liability and section B - accident benefits
Identify four examples of non-owned property that can be insured under the SEF NO. 31 nonowned, equipments endorsement.
- Tanks
- Pumps
- Meters
- Apparatus
Identify two ways to write insurance on commercial vehicles
- Scheduled basis
- Fleet
Identify two methods of issuing fleet policies
- Scheduled automobil
- Blanket basis.
Identify two endorsements that may be used when vehicles are issued on a blanket basis
- SEF NO. 21b - blanket basis, fleet endorsement
- SEF NO. 21a - monthly reporting basis, fleet endorsement
Retrospective rating
When the insurer and insured agree, the final premium be charged with in a minimum and maximum range
Two ways coverage can be provided to businesses to ensure their third-party liability exposure for non-own vehicles operated on their behalf
- Separate policy.
- endorsement
Three groups of non-owned vehicles that may be used on behalf of an insured
- Owned by employee
- Hired automobile
- Operated under contract for insured
Why would and employer carry an SPF NO. 6 standard non-owned automobile policy?
When an automobile is rented in the name of the business
Identify three persons, other than the name insured would be covered under an SPF #6 who drives a non-owned automobile in the business of the insured
- Partner
- Officer
- Employee
What endorsement can be attached to the SPF #6 when an insurer wishes to excluded driver with a bad driving history
SEF NO. 98 - excluding automobiles personally driven by named persons endorsement.
5 good candidates for the SPF NO. 4 - Standard Garage Policy
- Auto dealer
- Repair garage
- Service station
- Storage garages
- Parking lots
Coverages for SPF NO. 4
A - TPL
B - accident benefits
C - loss or damage to owner automobile
D - uninsured motorist coverage
E - LL for damage to customers automobile, while in care, custody or control of insured
3 owned automobiles covered under Section A of the SPF NO. 4
Tow trucks
Service loaders
Automobiles held for sale
Two types of non-owned automobiles covered under Section A of SPF NO. 4
Those of Customers
Those of Others
What is the greatest exposure to garage is for liability arising out of non-owned vehicles
While test driving clients automobiles
Basis of premium rating for owned vehicles under third-party liability
Payroll and staff units
To rate tables used when determining the premium for third-party liability for customers automobiles
Payroll and staff units
SEF NO. 70 Named chauffeur endorsement
When vehicles are driven by designated employees only
SEF NO. 79 fire, and theft deductible endorsement.
To reduce premium required, when it is agreed to pay the deductible on all fire and theft losses under subsections 2,3,4.
Monthly average basis
Insured selects an amount of insurance, which represents the maximum value of owned automobiles expected at anyone time 
Co-Insurance basis
A penalty will be applied if insured amount is less than 80% of the actual cash value of all owned automobiles.
SEF NO. 73 excluding, financed, automobile endorsement.
Remove the physical damage coverage is provided by the policy for such automobiles
SEF NO. 74 open lot pilferage endorsement - owned automobiles
Can be purchased provide coverage for pilferage losses
SEF NO. 75 Open lot pilferage endorsement - customers automobiles
By theft from any open lot or unroofed space owned, rented or controlled by the insured except the theft of an entire automobile
SEF NO. 77 legal liability for comprehensive damage to customers automobiles endorsement (including open lot pilferage)
Coverage provided against loss from any peril other than by collision or by upset.
