CODE OF C Flashcards
1.What is an example of Misconduct? Page 15
An agent failed to fully assess a client’s needs and objectives and neglected to advise the client of changes to the insurance plan as a consequence of a medical condition
An agent provided a copy of a client’s insurance policy to other customers as an example of the product being offered
An agent must act is an honest, courteous and respectful manner when dealing with other agents
a and b
a and b
2.What is a requirement when dealing with clients, an agent must? Page 14
Protect client’s interests and privacy
Appropriately evaluate the client’s needs
Disclose all material information
d All of the above
d all of the above
3.The exercise of Good Faith by certificate holders in the practice of insurance is essential to public confidence in the industry. To whom does the agent owe good faith? Page 9
Insurers, insureds, fellow agents, the general public
Insurers, insureds, fellow agents, regulatory bodies, their employer
Insurers, insureds, fellow agents, regulatory bodies and the public
all of the above
Insurers, insureds, fellow agents, regulatory bodies and the public
.Which statement is FALSE in regards to dealing with clients as an Agent? Page 14
Charge the client a mandatory undisclosed fee for providing them services to correctly select an appropriate insurance policy based on their risk
Protect client’s interests and privacy
Appropriately evaluate the client’s needs
Disclose all material information
Charge the client a mandatory undisclosed fee for providing them services to correctly select an appropriate insurance policy based on their risk
5.Engaging in misleading advertising breaches the following codes: pages 15 and 18
Dealing with the public, competence
Dealing with the agent, dealing with the client
Dealing with the public, dealing with the client
Dealing with the AIC, Compliance to the Government
Dealing with the public, dealing with the client
6.Bob and the local insurance agent, Tim, are close friends. As Bob is a mechanic and Tim has a passion for cars they decide to start a mechanics shop business on the side. In order to help keep start-up costs minimal, Tim brokers the deal through his own agency and gets the Named Perils Commercial Property Policy only. He does not get any additional coverage, and they plan to add coverage as the business grows. pages 14 and16. Which of the following statements is most correct about Tim’s actions?
Tim breached the Financial Integrity Code as he is not properly handing business operations of their company
Tim breached the Dealing with Clients Code as he is in a conflict of interest
Tim breached the Competence Code as he intentionally held information from the Insurer
Tim Breached the Dealing with Insurers Code as he falsified information to the Insurer
B and D
B and C
B and D
7.What is the Principle of Financial Integrity? Page 13
As an insurance agent, clients and insurers entrust money, property, and financial instruments to you to facilitate transactions or claims on their behalf. An agent’s integrity in this regard is essential to their practice as an agent
An agent must demonstrate financial integrity. This means an agent can be relied upon to properly safeguard and account for money and property entrusted to them and to promptly deliver them in accordance with the circumstances
Agents act as intermediaries between clients, insureds and insurers in a contractual relationship. The insurers ability to meet their contractual duties is based on the agent’s honesty and competence in providing advice and information
All of the above
As an insurance agent, clients and insurers entrust money, property, and financial instruments to you to facilitate transactions or claims on their behalf. An agent’s integrity in this regard is essential to their practice as an agent
8.Which of the following is considered an Agent under Code of Conduct? Page 6
A person who has authority from certification to transact insurance business and who’s license is sponsored by a sponsoring insurer and carries on best practices as outlined in the Insurance Act
An individual that holds a certificate of authority to transact insurance business as defined in the Insurance Act
A representative of an insurance company who is paid as an underwriter and who receives compensation or commission for placing risks fairly and competently
An individual who sells insurance on behalf of an agency who is approved by Alberta Insurance Council, General Insurance Council and Brokers Association of Alberta
An individual that holds a certificate of authority to transact insurance business as defined in the Insurance Act
9.Kyle has been in the business for 40 years. Due to the issues in early 2020 due to COVID-19 viruses and the clients not visiting his office, Kyle is not technically advanced and doesn’t prefer to use technology. To stay in touch, he takes the opportunity, contacting all of his clients on the phone, overselling insurance to them while they are scared of this pandemic. His actions are an example of breaching which section of the Code of Conduct? Pages 2 and 3
Incompetence in dealing with the pubic
Lack of financial integrity in dealing with clients
Breaching confidentiality in dealing with his clients
Mismanagement of customer’s funds to gain personally
Lack of financial integrity in dealing with clients
10.You are a Broker. One of your insurance companies, XYZ Insurance Company is sending top performers on an all-inclusive vacation. You are just shy of being able to go. All you need to qualify is place one more piece of business with XYZ Insurance Company. You have already supplied a commercial quote for a client and received information back, but XYZ Company does not have the best available product for this available. You encourage your client to go with XYZ Insurance Company. This is an issue of competency, and is an example of: page 12
Being persuaded by personal gain
Violating the trust of the client
Misconduct
All of the above
Misconduct
11.Alberta Insurance Council is the body responsible to provide administrative and investigative support to these industry specific councils: page 5
Alberta Insurance Council, General Insurance Council, Accident & Sickness Council
11.Alberta Insurance Council is the body responsible to provide administrative and investigative support to these industry specific councils: page 5
Alberta Insurance Council, General Insurance Council, Accident & Sickness Council
Life Insurance Council, General Insurance Council, Adjusters Council
Life Insurance Council, Accident & Sickness Council, Adjusters Council
Alberta Insurance Council, General Insurance Council, Adjusters Insurance Council
Life Insurance Council, General Insurance Council, Adjusters Council
12.Where an agent collects or receives funds on behalf of the insurer, they must: page 13
Not use or apply the funds for purposes other than as described in the agreement with the insurer
Pay the insurer all funds collected or less any deductions authorized by the insurer
Pay to clients all funds due to them
All of the above
All of the above
13.Under what circumstances in the Code of Conduct would you be able to breach client confidentiality? Page 15
When the clients mother calls to inquire about their policy because our client is away
When the parents give their consent for you to give information to a third party
When an approved investigator, RCMP or lawyer contacts your office to inquire about the named insured regarding their tenant policy
When there is an investigation regarding the named insured, and it is required by criminal law to share information
When an approved investigator, RCMP or lawyer contacts your office to inquire about the named insured regarding their tenant policy
14.Ted, the Agent requested an insurer cancel a client’s insurance policy for non-payment of premium, when the premium had been paid, in order to apply the pro-rata premium against an outstanding debt. This is an example of misconduct in which category of the Code of Conduct? Page 8
Good Faith
Competence
Dealing with clients
Trustworthiness
Trustworthiness
15.The agent must carry on the business of insurance in good faith. Good faith is honesty and decency of purpose and a sincere intention on your part to act in a manner which is consistent with your client’s best interests, remaining faithful to your duties and obligations as a holder of an insurance agent’s certificate of authority. To whom does the Agent owe this duty? Page 9
Insurers, insureds, fellow agents
The agent acts solely for the client
The agent acts solely for the insurer, but must follow Insurance Act and allowable protocols of that insurer
Insurers, insureds, fellow agents, regulatory bodies and the public
Insurers, insureds, fellow agents, regulatory bodies and the public
