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Government In insurance Flashcards

1
Q

What is the role of the provincial government?

A
  • supervise terms and conditions of insurance contracts
  • license insurers
  • monitors financial stability of provincially liscensed insurers
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2
Q

When is an insurer considered to be solvent?

A

When they are capable of fulfilling their financial obligations

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3
Q

What is a fiduciary?

A

One who handles other people’s money

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4
Q

Insurers and brokers are both …..

A

Fiduciaries

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5
Q

Commissions are not fully earned until

A

The expiry of the insurance policy

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6
Q

The insurance act requires these 6 details appear on every policy of insurance

A
  1. Parties to the contract
  2. Policy period
  3. Loss Payable or Payee
  4. Type of insurance coverage and amounts for which insurer may be liable
  5. Rate and premium charged
  6. Subject matter of insurance
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7
Q

Every policy insuring loss by fire must provide these 3 coverages

A
  1. Fire
  2. Lightening
  3. Explosion of natural gas, Coal or Manufactured Gas
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8
Q

List 3 forms of misrepresentation

A
  1. A false description of the property to the prejudice of the insurer
  2. Misrepresentation of a material fact
  3. Fraudulent omission of a material fact
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9
Q

Deliberate attempt to deceive with a view to securing some profit

A

Fraud

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10
Q

Insurer is not entitled to rights of ownership or control; nor can insured abandon insured property to it

A

Entry, control, abandonment

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11
Q

Written notice to the insurer can be delivered at or sent by registered mail to the chief agency or head office of the insurer in the province

A

Notice

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12
Q

Required to be made within 60 days after completion of proof of loss, unless the contract provides for a shorter period

A

When loss payable

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13
Q

Identifies the documents needed when a claim is filed

A

Requirements after loss

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14
Q

Coverage of insurance takes effect at?

A

12:01 am standard time at the address of the Named Insured

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15
Q

The Removal clause requires the insurer to extend coverage to another location where the insured property is kept, even if this location is not stated on the policy

A

The insured moved personal property to another secure location to protect it from loss because of natural disaster

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16
Q

Subrogation

A

The legal process the insurer uses to recover loss caused by a third party to the indemnified insured

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17
Q

Policies insuring the peril fire must include coverage for

A

Explosion of natural, coal or manufactured gas and lightning, excluding damage to electrical appliances and devices

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18
Q

Misrepresentation statutory condition no. 1

A

Statements made by the applicant, which lead the insurer to believe that the risk is better than it actually is, are consider misrepresentation

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19
Q

Statutory conditions

A

The insurer has an obligation only to those parties whose name appears on the Declarations Page and who can prove insurance interest
Material Change is considered a change that alters the risk in a way that greatly increases the potential for some losses
When a loss is caused directly by an unreported Material Change, the insurer has the right to deny that claim

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20
Q

Statutory conditions - Termination 3 provisions

A

1 written request signed by all persons stated on the policy must be provided to the insurer
2 client does NOT have to give insurer any notice prior to the requested cancellation date
3 insurer has the right to change the insured administrative costs to process the cancelation, premium refund is calculated in a short-rate basis

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21
Q

In the event of a claim what 3 statutory conditions affect both the insurer and insured

A

1 the insured must provide proof of loss as soon as practicable
2 when the insurer opts for a cash settlement, payment must be made to the insured within 60 days after receipt of the proof of loss or less, if the contract provides for a shorter period
3 if the insurer denies the claim and the insured wishes to sue the insurer, legal action must be taken within one year after the date of the loss

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22
Q

How much notice does the insurer have to give the insured if they elect to repair or rebuild damaged property?

A

30 days after receipt of the Proof of Loss

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23
Q

Who can the insured provide proof of loss to?

A

Insurer or agent of insured

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24
Q

When can the insurer access property to investigate a loss?

A

Immediately

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25
What are the duties of a broker?
Must always present the clients risk truthfully and disclose all material facts
26
The main reason for Errors and Omissions claims
The failure to properly identify the clients loss exposures and offering the required coverages
27
Primary function of an Underwriter
Select those risks that are most likely to be profitable to the insurer
28
What is an underwriter looking for when checking an applicants claims and financial history?
A moral hazard
29
Name 3 Types of direct damage that are covered by a property fire policy
1 damage to the roof caused by fire fighters axes to dampen the fire 2 water damage to the entire structure to halt the spread of and extinguish the fire 3 heat damage to the siding of the undamaged part of the building
30
What is an example of indirect damage from a property fire ?
Loss of rental income from tenets who lets because the building was unsafe after the fire
31
What is a condition?
Is a clause in a policy that requires the insured to do or not do something
32
A warranty is
A promise made by the insured that certain facts are truly as they are represented and will remain so for the duration of the policy
33
A breach is
A condition that does not result in the denial of a claim so long as the loss was not caused by such a breach
34
At how many days will a vacant property loose coverage?
If the insured knowingly leaves a property vacant for more than 15 days
35
What are 3 types of property that can be covered?
1 money and securities 2 automobiles and other motorized vehicles 3 books of account
36
What 3 perils are not covered in property policies?
1 war and nuclear incident 2 earthquake and flood 3 sewer backup
37
What peril is covered under property policies?
Lightning, including lightning damage to electrical devices
38
What are 3 factors that decide the amount of a settlement?
1 replacement cost of the lost or damaged property less depreciation 2 financial interest of the insured in the property that was lost or damaged 3 the amazing of insurance purchases on the property that was lost or damaged
39
Actual cash value means
Replacement cost less the amount of depreciation
40
What guarantee does the standard mortgage clause provide?
That even if the insured breached a condition or warranty the mortgagees interests will still be protected
41
Who are deemed to be insured in the homeowners policies?
1 common law spouse who has lived with insured for five years 2 parents who are permanently living with the insured 3 the insurers daughter who lives in the dorm while attending university in a neighbouring province
42
What extensions of coverage are included in the homeowners policy?
1 property necessarily removed for up to 30 days to another location 2 repair cost to year out damage to a wall to replace a leaking water pipe 3 loss of freezer food which had spoiled during a power failure caused by a lightning strike to a power station
43
Can limits under the Homeowners Package be changed?
No,limits can not be changed nor can coverages be removed from the Package, but the limits automatically provided by the policy can be increased, if they are not sufficient
44
What does Condominium Unit Owners form cover?
Value of personal property, all improvements and betterment's made by the insured,Loss Assessment
45
What type of loss is NOT covered by Broad Commercial insurance?
Theft of money from a cash register
46
Name types of loss covered by Broad Commercial Insurance
All sources of smoke damage Vehicle impact damage to building even when operated by the insured or an employee of the insured Water damage resulting from a frozen or ruptured water pipe
47
What type of smoke damage is not covered under Broad Commercial insurance?
agricultural smudging or industrial operations
48
What is the Co-Insurance Clause?
Limits the claims payment after a partial loss when the insurer finds that the insured has deliberately under-insured the values
49
what is the formula for co-insurance penalty?
Loss amount-((Did insure/should have insured)x loss amount)
50
Reinstatement Clause
After a loss has been paid by the insurer the amount of insurance stated on the policy does not change nor does the insured have to pay any additional premium
51
Temporary Location
A location, which is not owed, rented or controlled by the insured in whole or in part
52
Locked vehicle warranty
Keep the insured property in a fully enclosed metal compartment in or on the vehicle, close all windows and lock all doors when the vehicle is left unattended
53
Safe Burglary Insurance
Safe must be equipped with a combination lock | Visible signs of forced entry into the safe and/or removal of the safe from the insureds property by theives
54
Builders Risk-Broad Form insurance covers
Materials and supplies used in construction and forming part of the completed project Plant life used for construction Temporary buildings, such as trailers, scaffolding and hoarding
55
Builders risk coverage ends
when the construction is completed and the building is occupied
56
Under Earning and profits Form thee insurer will pay for loss of income
From the date of the loss and continue until the end of 12 months even if the insured has reopened the business after 3 months
57
The law that addresses wrongs against society is called?
Criminal law
58
The remedy in civil law consists of
Compensation to be paid to the party wha had suffered a wrong fine by another
59
What 3 elements must a plaintiff show in Tort law
1 the defendant owed a legal duty of car 2 the defendant breached the legal duty of care 3 the damages were suffered as the proximate result of the defendants actions
60
3 statements true about statute law
1 written law 2 enacted by federal or provincial legislation 3 can be set for acts where no precedent exists
61
Legal duty of care owed to an invitee is
To protect the invitee from any dangers to occupier is aware of or should be aware of

Insurance (4 decks)

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