Week 1 - Quiz 2 Survey

Question Title

* 1. The Superintendent of Insurance in Ontario is responsible for all of the following except one.

supervising the terms and conditions of insurance contracts.

licensing of Insurers.

monitoring financial stability of provincially licensed insurers.

licensing of insurance brokers

Question Title

* 2. When an insurer claims bankruptcy and can not pay the claims of its policy holders, the Property and Casualty Insurance Compensation Corporation (PACICC) does so on the bankrupt insurer's behalf. What are the maximum amounts that can be claimed from PACICC in this situation?

$250, 000 for a single occurrence and up to 70% of unearned premiums, subject to a maximum of $700 per policy.

$250, 000 for a single occurrence and up to 50% of unearned premiums, subject to a maximum of $500 per policy.

$200, 000 for a single occurrence and up to 70% of unearned premiums, subject to a maximum of $700 per policy.

$200, 000 for a single occurrence and up to 50% of unearned premiums, subject to a maximum of $500 per policy.

Question Title

* 3. According to the Insurance Act, a Fire policy expires at?

12:01am standard time at the address of the insured.

12:01pm local time at the address of the insured.

12:01am standard time at the mailing address of the insurer.

12:01pm local time at the address of the insured.

Question Title

* 4. The Insurance Act states that the Removal of Property extension on a fire policy provides coverage for property temporarily removed from the insured premises to prevent loss, damage, destruction or further loss from an insured peril for a maximum period of:

seven (7) days.

fourteen (14) days.

thirty (30) days.

ninety (90) days.

Question Title

* 5. Which of the following statements is false with regard to the Fire Statutory Conditions?

A proof of loss must be submitted to an insurer as soon as practicable.

A policy holder must inform an insurer as soon as practicable in writing of any change material to the risk insured within their knowledge or control.

An insurer has the right to entry and control of a property which has suffered a loss. An Insured cannot abandon the property to the insurer.

An insurer must provide 5 days written notice to a policy holder if the notice is hand delivered should it wish to cancel the policy.

Question Title

* 6. As specified in the Insurance Act, an Insurer will settle a claim under a fire policy by paying the:

Actual Cash Value of the property damaged.

Insured's interest in the property.

Amount of insurance applicable to the item.

Least of answer a, b or c.

Question Title

* 7. The Insurance Act states that one of the following situations is not excluded under a fire policy.

Damage occurring to property which was removed to prevent further damage nine days after its removal from the insured location.

Damage to the insured property due to war.

Damage due to the explosion of a frozen water pipe.

Damage caused by a fire which spread from a neighbouring property to the insured property.

Question Title

* 8. A misrepresentation made at the point of the application for a policy:

subjects the policy to a ten percent (10%) surcharge.

forces the insurer to cancel the policy.

makes the policy voidable at the option of the insurer.

is of little consequence to the insurer.

Question Title

* 9. Statutory conditions:

are sections of the Insurance Act that must be printed on all fire and automobile insurance policies.

are rules created by the collective body of insurers in the province of Ontario who have agreed to include the wordings in their own policies.

are a listing of coverage exclusions in plain English so policy holders can determine what their coverage does not protect them against.

are the sections of law which state that applications for insurance must be statutory declarations of the material facts pertaining to a particular risk.

Question Title

* 10. According to the Fire Statutory Conditions, after a fire loss, the insured must submit a proof of loss form:

within 30 days of the loss.

within 60 days of the loss.

within 90 days of the loss.

as soon as practicable.

Question Title

* 11. Should the insurer exercise their option to rebuild a property after a loss, the work must begin:

15 days after the receipt of the proof of loss.

30 days after the receipt of the proof of loss.

45 days after the receipt of the proof of loss.

60 days after the receipt of the proof of loss.

Question Title

* 12. Salvage is:

Property remaining after a loss which still has some value.

Property damaged or destroyed after the loss.

Property remaining after a loss which has no value.

A statutory condition which states the Insurer will pay the full value of all salvaged property after a loss.

Question Title

* 13. If an insured is unsatisfied with an offer to settle a claim, under the fire statutory conditions the insured may sue the insurer:

Within two years after the damage occurs.

Within one year after the damage occurs.

Within two years after the submission of the Proof of Loss.

Within one year after the submission of the Proof of Loss.

Question Title

* 14. Indemnity

is replacing a damaged item with a new one.

is paying cash for the loss.

ensures an insured neither gains nor loses from an insured loss.

is sharing the losses of a few among many.

Question Title

* 15. Which of the following is not an element required to be present to make all contracts enforceable at law?

Consideration.

Legal capacity of all parties to the contract.

The object of the contract must be legal.

Utmost good faith between all parties.

Question Title

* 16. Which of the following does not have the legal capacity to contract?

Sonia Sutter a.k.a Sonia's Sports centres.

Mike's Fishing Supplies and Skating stores.

Friendly Insurance Brokers Ltd.

Norma's Garden Centre Inc.

Question Title

* 17. The Insurance Act states that a fire policy must include three period which are:

Fire, theft and Vandalism.

Fire, Lightning and Limited Explosion.

Fire, Explosion and Smoke damage.

Fire, Lightning and Smoke damage.

Question Title

* 18. A contract which is against public policy:

is unenforceable and void.

is uninsurable.

requires approval of the Superintendent of the Financial Services Commission of Ontario.

must contain all 5 elements of Common Law contracts to be enforceable at law.

Question Title

* 19. Insurance contracts require three additional elements to make an insurance contract enforceable at law. Which of the following is NOT one of these additional elements?

Insurable interest.

An unconditional agreement.

Utmost Good Faith.

Indemnity.

Question Title

* 20. A reinsurer who is taking on a portion of a risk that has already been reinsured is sometimes called:

a cessionaire.

a retrocessionaire.

a retroinsurer.

a cession.

Question Title

* 21. Treaty reinsurance exists when:

companies have standard agreements to share particular classifications of risk, and therefore need not discuss each risk individually.

companies reinsure very large risks and need to discuss specific details of each reinsurance policy.

there is an equal division of risk and premium between the insurers.

one insurer pays up to a certain agreed upon amount in the event of a loss, and the second insurer pays all values over and above that agreed to amount.

Question Title

* 22. A house suffers a fire where the bedroom suffers the majority of the damage. The original claim is for damage to the bedroom furniture, clothing in the wardrobes, carpeting and curtains. The insured also claims for the value of jewellery that he stated was also lost in the fire. The insurer is able to determine that there was no jewellery present before or after the fire. If the Insurer discovers the fraudulent claim of jewellery:

the portion for the claim for jewellery will be forfeited.

the entire claim for all damaged property will be forfeited.

the insurer will pay the claim, but cancel the policy.

the insured will lose the claims free discount on the policy.

Question Title

* 23. Who would not be considered to have insurable interest?

The owner of a home.

A mortgagee of the property.

The owner of a building that is totally rented to others.

A person who expects to inherit property after their father's death.

Question Title

* 24. A basic fire policy will automatically cover all of the following except one. What is the exception?

A trustee in a bankruptcy.

The heir to property after the death of the original insured.

The spouse of the named insured and who is named in the policy.

The purchaser of a building after the building has been transferred from the original insured.

Question Title

* 25. Which of the following is not a generally accepted practice for dealing with risk?

Ignoring the risk.

Controlling the risk.

Transferring the risk.

Avoiding the risk.

Question Title

* 26. Which of the following is false with regard to subrogation?

the pursuing of payment from the responsible third party.

can be pursued by the insurer only after payment of a claim under the insurance contract.

can be pursued by the insured after a claim has been paid by the insurer.

proceeding to recover from a negligent third party is commenced in the name of the insured