FSCO.PPA Flashcards

1
Q

Identify the 6 prohibited risk classification elements in ON regulations.

A
Claims where fault ≤ 25%
    –
Credit history
Occupation (some exceptions)
Net worth
Employment history
Salary
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2
Q

Assess whether the following discount complies with ON regulations:

  1. Retiree discount
  2. Multi-line discount
  3. Good credit score discount
A
  1. Yes, required by ON regulations
  2. Yes, but only if they do not vary by property product.
  3. No, prohibited
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3
Q

Identify the 2 types of regulatory approval in ON.

A
  • prior approval (major requirements, simplified guidelines)
  • file & use (major requirements, minor requirements)
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4
Q

Describe FSCO prior approval

A

For prior approval, FSCO must approve the following before rates can be used:
• rates
• rate changes
• risk classification

Examples where prior approval can be used:
• PPA on OAP1 (Private Passenger Auto written using the standard Ontario Auto Policy 1)
• FA (Facility Association)

Expedited approval is a type of prior approval with approval in 30 days

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5
Q

Describe file & use.

A

For file & use, the insurer must file:
* rates
* rate changes
* risk classification
THEN regulators have 30 days to approve otherwise rates can be used without approval
Examples:
* other than PPA
* commercial auto
* endorsements
* FA is excluded (not eligible for expedited approval)

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6
Q

Describe the UDAP (Unfair or Deceptive Acts or Practices) requirement regarding rate levels among affiliates

A

It is unfair or deceptive if the insurer fails to provide the lowest rate among all affiliates

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7
Q

What is OCPF-44R coverage

A
  • coverage for ‘underinsured MOTORIST’ (as opposed to ‘uninsured AUTO’)
  • it is the difference between (your TPL limit) & (at-fault driver’s TPL limit)
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8
Q

Identify 5 regulatory requirements when changing territory factors in a major filing.

A

REBASE current, indicated, proposed territorial relativities
CALCULATE indicated change, proposed change
CHECK:
- indicated and proposed changes have the same sign
- proposed RC (%) < indicated RC (%)
- magnitude proposed change btwn (-10%, 10%)

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9
Q

Identify the required designation, timing and 4 filing items for officer certification on major filing.

A
  • Designation: CEO, CFO or Chief Agent in Canada
  • Timing: Always required
  • Includes:
    1. Effective dates (new and renewal business)
    2. Guidelines (must certify compliance)
    3. Info/data (certify accuracy & completeness)
    4. Rates are reasonable, nor unfairly discriminatory and do not impair solvency
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10
Q

Identify the required designation, timing and 6 filing items required for actuarial certification in major filings.

A
  • Designation: FCIA
  • Timing: when there are rate changes or new LOB
  • Includes:
    1. Effective dates (new & renewal business)
    2. Vehicle classification system
    3. That Actuary has been authorized by insurer
    4. That data is reliable & sufficient
    5. That AAP was used
    6. That risk classification system is reasonable
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11
Q

Briefly explain what info is generally required in a rate filing.

A
  • All steps for rate changes
  • Trace steps from raw data to final rates
  • No specific methodology mandated by FSCO
  • Include RSP as if never ceded, exclude reinsurance and FA
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