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Exam 6 > FSCO.PPA > Flashcards

FSCO.PPA Flashcards

1
Q

prohibited risk classification elements

A

C-Cones
- Claims where fault <=25%: past claims from accidents after 9/1/2010 for which an insured was <=25% at fault
- Credit history
- Occupation with exceptions
- Net worth
- Employment
- Salary

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2
Q

does this comply with ON regulations?
retiree discount on all coverages

A

yes.
this is required by ON regulations

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3
Q

does this comply with ON regulations?
multi-line discount varying by property product

A

no
multi line discounts are permitted, but they CANNOT vary by property product (cannot have diff discount rates for diff line, ex: 10% for houses and 5% for condos)

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4
Q

good credit discount
does this comply with ON regulations?

A

no
use of credit in ON personal auto is not permitted

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5
Q

can an insurer cancel your policy if you become unemployed
?

A

no

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6
Q

can an insurer non renew because of a drunk driving conviction?

A

yes
it is ok to use convictions for underwriting

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7
Q

can an insurer lower your rates because your salary increased?

A

no

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8
Q

can an insurer change your rates because you moved?

A

yes

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9
Q

can an insurer raise your rates if you become an uber driver?

A

yes, use is a valid rating variable

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10
Q

can an insurer lower your rates because you own a certain credit card?

A

no, credit history as well as number or type of credit cards is a prohibited risk classification element

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11
Q

list 2 types and 2 subtypes of approval process offered by ON

A

1) prior approval (PPA, FA)
- major requirements
- simplified guidelines
2) file and use (other than PPA, commercial)
- major requirements
- minor requirements

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12
Q

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

A

it is unfair or deceptive 欺骗性的 if the insurer fails t provide the lowest rate among all affiliates

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13
Q

describe FSCO prior approval and give examples of vehicle classes to which it applies

A
  • FSCO must approve RRR before rates can be used
  • ex:
    1) PPA on OAP1 (PPA written using standard ON auto policy
    2) FA
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14
Q

describe FSCO expedited approval and give examples of vehicle classes to which it applies

A
  • expedited approval is a type of prior approval with approval in 30 days
  • ex:
    1) PPA on OAP1
    2) FA is excluded
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15
Q

describe FSCO file and use and give examples of vehicle classes to which it applies

A
  • insurer must file RRR, then regulators have 30 days to approve otherwise rates can be used without approval
  • ex:
    1) other PPA
    2) commercial auto
    3) endorsements
    4) FA is excluded
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16
Q

what is OPCF-44R?

A
  • coverage for underinsured motorist
  • it is the difference between your TPL limit and at fault driver’s TPL limit
17
Q

identify regulatory requirements when changing territory factors in a major filing (different than simplified filing)

A
  • rebase current/indicated/proposed territorial relativities
  • calculate indicated/proposed change
  • check
    • indicated and proposed changes have the same sign
    • magnitude (proposed change) < magnitude (indicated change)
    • magnitude (proposed change) <10%
18
Q

officer certifications in major filings (timing and officer qualifications)

A
  • qualifications: CEO. COO, CFO, chief agent of Canada
  • always required
19
Q

what are the 4 filing items must an officer certify?

A

GRIE
- effective dates: for new and renewal business
- guidelines: must certify compliance
- info/data: certify accuracy and completeness
- rates: reasonable, not unfairly discriminatory, don’t impair solvency

20
Q

actuarial certifications in major filings (timing and qualifications)

A
  • FCIA
  • when rates change or there is a new LoB
21
Q

what are the 6 filing items must an actuary certify?

A

EVA-DAR
- Effective dates
- Vehicle classification system
- actuary Authorized by insurer
- Data is Rel Suff
- AAP used
- Risk classification system is reasonable

22
Q

is actuary’s certification needed for fleets?

A

no, but it is needed for
- endorsements
- commercial vehicles insured by FA
- FA

23
Q

what information is generally required in a rate filing?

A
  • data, narrative: all steps for rate changes
  • assumptions and methods: regulators should be able to trace steps from raw data to final rates
  • not required: a specific methodology mandated by FSCO
24
Q

describe the treatment of loss data in filing regarding reinsurance

A

Exclude
- reinsurance should not impact price charged to insured

25
Q

S2018Q2
F2013Q8

A
26
Q

describe the treatment of loss data in filings regarding cession to RSP

A

Include
- as if never ceded

27
Q

describe the treatment of loss data in filings regarding cession to farm losses

A

Exclude
- FA sets their own prices using FARM loss data

28
Q

identify 4 factors affecting the length of loss trend period

A
  • policy term
  • effective date: proposed effective date of rate change
  • calculation date: valuation date of loss data
29
Q

describe the general properties of coverages where premium trends are required

A
  • coverages with inflation sensitive exposure bases
  • where mix of business is changing
  • for clear filings: but premium trend is already accounted for in development of rate groups
    CLEAR= Canada Loss Experience Auto Rating
30
Q

why might FSCO not approve an auto filing?

A
  • insurer used prohibited rating variable
  • insurer’s risk classification system is not reasonable or not sufficient to predict losses

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