Insurance Broker Level 1 Set 5 Role of Governments and Statutory Conditions

Question 1

The Insurance Council

Answer 1

Is the regulatory body responsible for the licensing and discipline of insurance agents, brokers and adjusters in the province of Alberta.

Question 2

Role of the Federal Government

Answer 2

Provides licensing to insurers operating in Canada
Insurers must meet strict financial standards by office of the Superintendent of Financial Institutions
Ongoing monitoring of insurers to ensure solvency and financial stability
Ensure insurance companies maintain enough capacity for the risks they take on.
Supervise provincial branch.

Question 3

Role of the provincial government

Answer 3

Regulators
Superintendent of Insurance responsible for administering the Insurance Act
Supervise terms and conditions of insurance contracts
Licensing of insurance agents, brokers, insurers and adjusters
Monitor the solvency of provincially licensed insurers
Monitors inherence to the code of conduct

Question 4

Alberta Insurance Council

Answer 4

Financial Arm
Investigation, administration and support services to other councils
Administrative services to the continuing education accreditation committee appointed by the Minister of Finance

Question 5

Insurance Adjustors Council, General Insurance Council, life Insurance Council

Answer 5

Regulator bodies responsible for licensing and discipline of insurance agents, brokers and adjustors

Question 6

Insurance Bureau of Canada (IBC)

Answer 6

National Industry Association representing private general property and casual insurers
Draft policy forms and monitor/develop legislation- w/government according to insurance act.
Provides consumer information - annual report

Question 7

Insurance Institute of Canada

Answer 7

Education programs - CIP, CAIB
National exam, grading entries and awarding diplomas
Career and Industry Information

Question 8

Insurance Brokers of Canada (IBAC)

Answer 8

Develop and maintain licensing courses
Liaise with government, business, and consumer groups, insurance companies and industry organizations
Aims to improve service, safeguard interests of intermediaries within Canadian societies

Question 9

Property and Casualty Insurance Compensation Corporation (PACICC)

Answer 9

Insurance for Insurers
Protects consumers in the event an insurance company goes bankrupt and claims cannot be paid
Max. $250 000 for all claims arising from a single occurrence
Refund up to 70% of unearned premiums, max $700

Question 10

Underwriters’ Laboratory of Canada (ULC)

Answer 10

Operates Laboratories and certification service for examination
Testing and certification of devices, construction materials

Question 11

Statuary Condition (Change of Interest)

Answer 11

The insurer is liable for loss of damage occurring after an authorization under the bankruptcy act or change of title by succession, by operation of law or by death

Question 12

Statutory Condition ( Material Change)

Answer 12

Updates or additions- notify insurer within 90 days

Change in risk to insurer- could result in increased premiums

Question 13

Statutory Condition ( Property of Others)

Answer 13

Unless otherwise specifically stated in the contract, the Insurer is not liable for loss or damage to property owned by any person other than the insured, unless the interest of the insured therein is stated in the contract.

Question 14

Statutory Condition (Who may give notice and proof)

Answer 14

Anyone with financial interest
Named insured
Agent of the insured-Power of Attorney
Mortgagee

Question 15

Statutory Condition ( Entry, Control and Abandonment)

Answer 15

Insurer has an immediate right of access and entry after loss or damage to the insured property, further rights of access and entry after insured property

Question 16

Statutory Condition ( Salvage)

Answer 16

Saving insured property from further loss of damage
Insurer contributes to any reasonable expenses incurred by the insured from the salvage, including removal and 30 days storage

Question 17

Statutory Condition ( Replacement/Loss payable)

Answer 17

After Proof of Loss filed;

• 30 days for insurer to notify insured of repair or replacement
• 45 days to commence work
• 60 days to issue check if not replacing or repairing

Question 18

Statutory Condition ( Misrepresentation)

Answer 18

If a person applying for insurance falsely describes the property to the prejudice of the insurer or misrepresents or fraudulently omits to communicate any circumstances that is material. that is to be made known to the insurer in order to enable it to judge the risk to be undertaken, the contract is void as to any property in relation to which the misrepresentation or omission is material
Voids entire contract if discovered!

Question 19

Statutory Condition ( Termination)

Answer 19

Insured - anytime
Insurer - 5 Days if delivered by mail
- 15 days by registered mail, should
include refund