Study 5 Key Terms

Question 1

solvency

Answer 1

A business entity’s ability to meet its long-term financial commitments.

Question 2

order of commencement

Answer 2

A document, issued by the superintendent of financial institutions, giving a company approval to commence and carry on the business of insurance.

Question 3

Statutory Conditions

Answer 3

Special prescribed and standardized conditions that the provincial/territorial insurance acts require to be included in fire, automobile, and accident and sickness policies. The Statutory Conditions must be identified and printed in every fire policy; however, conditions will still govern the policy even in their absence.

Question 4

General Conditions

Answer 4

Conditions of a contract that set the minimum performance requirements for the contractor. These conditions also include the rights and responsibilities of the parties involved.

Question 5

Personal Information Protection and Electronic Documents Act (PIPEDA)

Answer 5

A federal statute that governs the collection and use of personal information. It states that personal information to be collected must be relevant, and that all information that has been collected, is being collected, or will be collected must be held in the strictest of confidence.