Insurance Broker Level 1 set 3

Question 1

Nine Auto Policy Statutory Conditions

Answer 1

1.Material Change in Risk
2. Prohibited Use by Insured
3. Requirements where loss or damage to
person or property
4. Requirements where loss or damage to the
Automobile
5. Inspection of Automobile
6. Time and manner of payment of
insurance money.
7. Who may give notice and proof of claims
8. Termination
9. Notice

Question 2

Binding Authority

Answer 2

An agent or broker has the authority to bind an insurer to an insurance contract without first submitting the application to the underwriter.

Question 3

When underwriting an automobile risk the underwriter will consider;

Answer 3

1. Driving records for all drivers of the vehicle
2. whether the vehicle is used for business or
   pleasure
3. The territory in which the vehicle will be
   primarily operated.

Question 4

Priorities of Payments, In Alberta the Insurance Act specifies that;

Answer 4

190 000 (95%) of the 200 000 minimum third party liability limit must be applied to bodily injury claims leaving only 10 000 (5%) for property damage claims

Question 5

Under the third party liability section of the automobile policy, the insured agrees to;

Answer 5

reimburse the insurer for all amounts the insurer has to pay because of the absolute liability law, but which the insurer would not otherwise be liable

Question 6

Facility Association

Answer 6

An organization that exists for the purpose of providing insurance for risks who are unable to obtain insurance protection in the regular market

Question 7

All Comers Rule

Answer 7

Means that any applicant requiring the minimum third party liability limit and accident benefits coverage cannot be refused by an insurer, broker or agent.

Question 8

Grid Rating

Answer 8

Implemented as a means of keeping mandatory insurance coverages affordable, applies to private passenger vehicles for basic coverage premiums.

Question 9

Common Carrier

Answer 9

Offers his or her services for hire

Question 10

SPF6- Non owned Automobile policy

Answer 10

Protects an employer for their responsibility for employees who operate vehicles not owned by the employer

Question 11

SPF9 Transportation Network Policy is needed when;

Answer 11

privately owned vehicles are used for ridesharing purposes.

Question 12

Civil Law

Answer 12

Settles disputes between individuals or other legal entities that does not fall in the area of criminal law. It allows victims to seek compensation for the wrong done to them.

Question 13

Common Law

Answer 13

Decisions are based on the rule of precedent and are also known as case law.

Question 14

Statute Law

Answer 14

Decisions based on written with laws made by governments.
Overrides common law
To provide for government regulation and control of activities of the citizen where such control is considered to be in the public interest.

Question 15

Tort

Answer 15

A civil wrongdoing other than a breach of contract.

Question 16

Three Elements of a tort

Answer 16

1. They were owed a legal duty; to be free from harm.
2. That this legal duty was breached; broken by defendant
3. That the plaintiff suffered damages; i.e; financial loss as a direct result of the defendants actions.

Question 17

Strict liability

Answer 17

Actions that can create Liability regardless of fault.
ex, intentionally burning garbage that spreads to a neighbors lawn.
- using explosives
- keeping dangerous animals
- operating any aircraft resulting in property damage or injury to persons on the ground.

Question 18

Joint Liability

Answer 18

Legal duty owed - ex. two neighbors working together to remove a tree and cause damage to a neighbors house. Each shall be held liable for the entire amount.

Question 19

Occurrence

Answer 19

An accident, including continuous or repeated exposure to substantially the same general harmful conditions.

Question 20

Compensatory Damages

Answer 20

Liability policies only pay damages that are considered to be compensatory.
Special damages can be determined exactly
General damages cannot be determined exactly.

Question 21

Supplementary Payments

Answer 21

The Limit of insurance purchased by the insured is reserved for the payment of any judgement against them and cannot be used for any other purpose. The amounts provided by this insuring agreement are over and above that limit.

Question 22

Unintentional Property damage to premises owned by others, or their contents which the insured is using, renting or otherwise are in the insured’s custody or control. Payment will only be made for the following cause of loss.

Answer 22

Fire
Explosion
Water Damage
Smoke- excluding smoke from a fireplace

Question 23

Coverage G - Good Neighbors Policy - Under this agreement the insurer agrees to make a voluntary property damage when;

Answer 23

Unintentionally caused for which the insured would not be legally liable. ex, the neighbors floor covering gets torn while helping him move a refrigerator. The insurer agrees to provide the payment even though the insured may not be liable.
Will also cover for damage intentionally caused by an 12 years of age or younger.

Question 24

Environmental Impairment Policy

Answer 24

Provides coverage for pollution liability and environmental cleanup.
Available only through specialty markets

Question 25

Self Insured Retention (SIR)

Answer 25

Applies to all losses covered by the Umbrella policy and which are not insured by the primary policies or policy.
Often functions as a deductible which often does not exceed $250

Question 26

Under Business Property the insurer agrees to provide coverage for injury or property damage out of the following business activities.

Answer 26

The rental to others, or holding for rent, of not more than three car spaces or stalls in garages or stables.

Question 27

For Trailers coverage is provided for injury or damage;

Answer 27

arising out of your ownership, use or operation of any trailer or its equipment, provided such trailer is not attached to, carried on or being towed by a motorized vehicle subject to a motor vehicle registration.

Question 28

Special Limitations on Watercraft and Motorized vehicles you own; coverage is automatically applied for bodily injury or property damage arising out of the use of the following:

Answer 28

Watercraft, with an outboard not more than 16 hp.
Watercraft, any other type of motor, not more than 50 hp.
Non- motorized watercraft not more than 26 feet in length

Question 29

All the best on your exam!!!

Answer 29

You’al got this!!

Question 29

The Facility Association requires a policy for flat cancellation to be;

Answer 29

returned immediately

Question 30

In the event of a loss under the habitational form of insurance, the insured must submit a proof of loss;

Answer 30

as soon as possible

Question 31

Three types of torts;

Answer 31

intentional
unintentional
strict liability

Question 32

A licensee is;

Answer 32

One who comes on the premises for his own purpose, but with the occupiers consent.

Question 33

An agent may be;

Answer 33

a corporation
may bind
may be a partnership

Question 34

An investigation under third party liability

Answer 34

is not excluded

Question 35

There is no deductible for;

Answer 35

Fire
Lighting
Theft of Auto

Question 36

Boats are not covered for;

Answer 36

Hail of wind damage on the standard home policy

Question 37

Policy Wordings do not include;

Answer 37

the premium to be charged

Question 38

Home Policy coverage for freezing only applies if the homeowner is gone for less than;

Answer 38

4 days or 96 hours

Question 39

Home Comprehensive covers trees;

Answer 39

5% of coverage A, limited 500 per tree, named perils coverage

Question 40

Under coverage E of the Comprehensive Personal liability section of property insurance policy, the insurers liability is limited to;

Answer 40

The limit stated on the declaration

Question 41

Property, casualty and general insurance covers;

Answer 41

Auto, property and liability

Question 42

For an agreement to exist there must be an offer made and;

Answer 42

and an unconditional acceptance of the terms of that offer

Question 43

An agent represents the interests of the;

Answer 43

Insurer

Question 44

Settlement is made on a replacement basis

Answer 44

for most personal property

Question 45

Outdoor trees, shrubs and plants are covered from;

Answer 45

fire, lighting explosion

impact by aircraft of land vehicles

Question 46

Additional living expenses does not cover

Answer 46

food, or anything above the normal cost of living

Question 47

Under the mobile home form

Answer 47

loss of damage caused by moving is not covered

Question 48

The automobile accident benefit coverage

Answer 48

is a no fault coverage

Question 49

If a pedestrian is injured be an uninsured vehicle, they can claim under;

Answer 49

The Motor Vehicle Accident Claims Fund