CHAPTERS 6 – 11 REVIEW QUIZ

1. A member must at all times be able to meet all of the

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member’s trust obligations. Which one (1) of the following

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is not considered trust funds?
a) Money in the member’s trust bank account.

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b) Investments held by the member in trust.
c) The member’s trust funds receivable, excluding

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premiums that have been receivable more than 90 days.
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d) The member’s fixed assets.
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2. Regulation 991 section 12 outlines the conditions for

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charging a fee for service. Which one of the following is

correct?
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a) The finance charge for accounts paid on an installment

plan must be disclosed.
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b) The fee must be negotiated in advance with the client.

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c) The amount of the fee, the proportion of the premium

retained by the broker and the total remuneration for the
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transaction must be disclosed in advance.

d) Any fee to be charged must be clearly identified on the
invoice.
 3. Which one (1) of the following would constitute proper
procedure after a complaint against a member of RIBO has

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been made?
a) The manager of RIBO has authority to deal with the

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matter, as he or she deems appropriate.

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b) The matter is brought before the Council of RIBO who
determines which Committee shall investigate it and deal
with it.

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c) If the complaint is regarding alleged misuse of Trust
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Funds, the matter is brought directly before a Discipline
Committee to be investigated.
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d) The matter is brought before a Complaints Committee

to be investigated, after at least two (2) weeks prior notice
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is given to the member.

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np
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 4. Under which one (1) of the following circumstances can
information contained in the client file of an insurance

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broker are divulged to others?
a) When the financial details of the insured’s affairs are

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requested by the spouse.

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b) When the broker must do so in conducting negotiations
with underwriters or insurers on behalf of the client.

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c) In response to a request from a credit company seeking

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to establish the client’s net worth.
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d) When the information is requested in writing from
another insurance broker intending to quote on the risk.
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nt
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np
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 5. Under Ontario Regulation 991, Section 14, what action
must be taken before business for a client is placed with

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an insurer that owns shares in the brokerage?
a) Disclose the relationship in writing under all

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circumstances.

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b) Tell the client of the relationship before ordering the
policy.

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c) None, if the insurer holds less than 10% of the voting
rights of all issued shares.
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d) Disclose the relationship in writing if the insurer holds
10% or more of the voting rights of all issued shares.
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6. Which one of the following situations would not provide

reasonable grounds for an investigation to be ordered?
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a) Member may be incapacitated

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b) Member may have inappropriately dispersed trust

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funds.
c) Member has allegedly committed misconduct.
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d) Member has not completed continuing education

requirements.
 7. Upon successful completion of the examination you may
qualify for registration as an insurance broker. If issued,

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the registration will be “restricted to acting under
supervision”. Which one (1) of the following most

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accurately describes the conditions under which you may
act as an insurance broker under supervision?

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a) You may solicit insurance inside or outside your office
but only in the community where your office is located.

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b) You may operate a trust account in your own name into
which you may deposit premiums you receive from
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policyholders.
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c) You may solicit insurance only from persons who call at,
or telephone your office.
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d) You may not act as a sole proprietor, nor be a “Principal

Broker” as the term is used in the regulation, nor may you
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control trust funds.

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np
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 8. An individual who acts or aids in any manner in
soliciting, negotiating or procuring the making of any

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contract of insurance is required to be registered as an
insurance broker if they:

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a) Is licensed as an insurance agent, representing a single

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insurer and a Facility Association.
b) Performs these duties as a favour to a friend who does
not understand English.

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c) Deals directly with the public and receives
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compensation.
d) Performs these duties on behalf of their employer with
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respect to the employer’s own insurance program.

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nt
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np
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 9. Which one of the following situations would not require
a member to declare its relationship with an insurer?

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a) When the insurer has an indirect common ownership
with the member.

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b) When the broker has a direct common ownership with

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the insurer.
c) When insurer or member directly or indirectly holds

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shares with more than 10% voting rights.

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d) When member knowingly solicits insurance with an
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insurer having direct control of the member over 10% of
all voting shares.
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10. Which one of the following is not required to be

included in a certificate of coverage?
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a) A loss payee clause.

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b) The name and mailing address details of the insured.

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c) Details of the coverage provided.

d) Full name of each insurer involved in risk.
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 11. When a loss occurs to one part of property which
consists of several parts, the basis of settlement shall be

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______________________________________.
a) The total value of the entire property, less the cost of

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installation.

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b) The replacement value of the entire policy.
c) The value of the lost or damaged part(s), including the

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installation.

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d) The value of the total property less the value of the lost
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or damaged part.
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12. The three criteria considered by the adjuster in

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determining the amount of a loss are as follows: (1) the

interest of the insured in the property;(2) the amount of
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insurance specified on the “Declaration Page” in respect of

the property lost or damage; and (3)________________
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a) The replacement value of the policy.

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b) The actual cash value of the property at the time of loss

or damage.
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c) The original value of the property when purchased.

d) The current market value of the property.
 13. The formula for determining Actual Cash Value is

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____________________

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a) ACV=Replacement Cost – initial cost X inflation

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b) ACV=Initial cost – Present value
c) ACV= Replacement Cost – Depreciation

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d) ACV= Initial Cost – Depreciation

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14. Which of the following people are not covered under
the RIBO Homeowners form?
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a) Common-law spouse who has lived with the named

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insured for longer than 3 years.

b) Grandparents or children of the named insured.
nt

c) Children of the Named Insured who are away at school,

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college or university.
np

d) Boarders or renters.
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 15. When a loss occurs to an insured property and involves
different types of property, how is the deductible applied

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to the claim?
a) Each property has its own deductible amount.

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b) Only one deductible will be applied to the total amount

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of the claim.
c) Only the highest deductible well be applied to one of

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the properties.

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d) The deductible will only apply to theft losses.
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16. When joint tortfeasors are responsible for damages

but the liability is being disputed, each of the tortfeasors is
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held liable for an amount of ________________________.

This encourages liable joint tortfeasors to settle the
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dispute themselves or split the damages evenly: it also

encourages shorter settlement periods.
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a) The total loss or damages.

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b) Half the total damages.

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c) 10% until the claim is settled.

d) Nothing.
 17. A _________________ is one who comes onto the
premises of the occupier or owner of a property for his or

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her own purposes, but with the occupier’s consent, such
as a postal worker, social guest or meter reader.

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a) Bailee.

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b) Visitor or invitee.
c) Trespasser or burglar.

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d) Uninvited visitor. nc
18. Your 10 year old daughter intentionally throws rocks
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through 5 of your neighbours windows causing $2000 in

damage. You are later sued for damages. This would be
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covered under:
a) Legal liability- personal liability of your Homeowner’s
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policy.
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b) Voluntary property damage of your Homeowner’s

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policy.
c) Tenants legal liability coverage of your Homeowner’s
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policy.
d) None of the above.
 19. Which of the following supplementary payments will
the insurer NOT pay under section ll, liability coverage?

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a) Interest accruing on the portion of the judgement
within the policy limits.

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b) Expenses the insured has incurred for the emergency

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medical attention of others.
c) Reasonable expenses including actual loss of income up

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to $100 per day which the insured incurs at the request of
the insurer.
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d) Legal fees when the insured must pursue an at fault
party for the damages after an accident on their premises.
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20. All of the following are exclusion under your

Homeowner’s Liability section except:
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a) The rendering or failure to render any professional

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service.
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b) Liability imposed by any workers compensation statute.

c) Business pursuits or business use of your premises
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except as otherwise specified in this policy.

d) The ownership, use or operation of a motorized vehicle,
trailer or watercraft.
 21. An Umbrella policy:

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a) Is not usually subject to a deductible or SIR.

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b) May contain very specific territory limitations.

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c) Provides excess insurance over another policy.
d) Does not require an application.

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22. OAP 1, Section 5: Uninsured Automobile coverage:
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a) Must be added by endorsement to Owners Form (OAF
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1).
b) Only covers bodily injury, but never property damage.
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c) Can cover accidental damage to the insured’s

automobile, provided the uninsured owner or driver of the
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other automobile is identified.

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d) Provides coverage for third parties if the insured causes

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bodily injury and has breached a statutory condition.

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 23. Leila parks their truck at a shopping mall. When she
returns, she finds it has been damaged by another vehicle.

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She has an OAP 1 Owner’s Form with Section 3: Liability
Coverage, Section 4: Accident Benefits Coverage, Section

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7: Loss or Damage Coverages (Optional) Coverage B:
Comprehensive, and OPCF 44: Family Protection

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Endorsement. What section would cover the damage?
a) Coverage B: Comprehensive.

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b) OPCF 44: Family Protection Endorsement
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c) Section 3: Liability Coverages.
d) There would be no coverage.
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np
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 24. In the following statement about Section 6 – Direct
Compensation – Property Damage coverage is incorrect?

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a) The policy on the other vehicle must be issued by an
Ontario licensed insurer or one that has filed with the

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Ontario Insurance Commission to provide this coverage.

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b) The insured collects from his/her insurer even though
the operator of the vehicle, with the insured’s consent,
was not entirely at fault for the accident.

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c) The accident may occur anywhere in Canada and at
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least one of the other automobiles involved is insured
under a motor vehicle liability policy.
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d) It covers damage to the automobile, certain

unscheduled trailers, their equipment and contents caused
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by another automobile in Ontario, including their loss of

use.
nt
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25. Rising water is covered under:

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a) All perils only.

b) Comprehensive only.
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c) Comprehensive but not Specified perils.

d) All Perils, Comprehensive and Specified perils.
 26. Terence’s automobile is broken into and some articles
are taken. His specified perils policy will cover:

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a) Musical instruments that were in the trunk.

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b) The bumper jack belonging to the automobile.

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c) The insured’s raincoat.
d) Property of the insured’s passengers.

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27. Steve drove his automobile into his own garage door.
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What would be included under the own damage coverage
of his OAP 1?
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a) Both the auto and the door.

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b) Neither the auto nor the door.

c) The auto.
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d) The door.
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np
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 28. Which of the following is covered under Section 7: Loss
or Damage Coverages, Coverage D: All Perils of the OAP 1?

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a) Damage caused to the automobile while the driver was
under the influence of drugs.

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b) Radioactive contamination.

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c) Rusting of the automobile body.
d) Vandalism damage to the automobile.

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29. While ice fishing on Lake Simcoe, Harpreet’s
automobile went through the ice. She has an OAP 1 with
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Section 3: Liability Coverage, Section 4: Accident Benefits

Coverage, Section 5: Uninsured Automobile Coverage,
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Section 6: Direct Compensation — Property Damage

Coverage and Section 7, Coverage B: Comprehensive. This
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means her insurer:

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a) Would pay the claim in full.

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b) Would not pay the claim, as there is no coverage.

c) Would pay the claim less the deductible.
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d) Would not pay the claim, as the automobile was not

being operated on a public highway.
 30. Insurance under Section 7 of OAP 1 Owner’s Form,
Loss or Damage Coverages, is usually subject to a

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deductible. It does not apply to loss or damage caused by:
a) Water.

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b) Lightning

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c) Vandalism
d) Windstorm

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31. Which of the following statements is false regarding
business income insurance?
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a) It replaces income that’s lost when the insured or a key

employee suffers a serious illness and is unable to work for
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an extended period of time.

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b) It replaces income that’s lost when insured damage to a

building, equipment or stock forces a business to slow
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down or suspend its operations.

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c) It replaces income lost through slowdowns if they’re

caused by insured events.
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d) The loss of business income must occur on premises

identified in the policy’s schedule of locations.
 32. Allan insured his building for the appraised value of
$800,000 on a replacement cost basis. The co-insurance

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clause is 90%. How much insurance should Allan carry on
his building to meet the coinsurance clause.

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a) 90,000

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b) $640,000
c) $720.000

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d) $800,000 nc
33. Sanjay insures his office contents for $100,000. The co-
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insurance clause is 90%. Following a large fire, Sanjay’s

total loss was $125,000. How much will Sanjay receive
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from his insurance company (disregard any deductible)?

a) $ 80,000
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b) $ 90,000
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c) $100,000
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d) $125,000
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 34. This type of coverage protects the business owner or
business organization from liability connected to the

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business premises, current or completed business
operations and products that have been sold or provided

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to the party who alleges injury or damage. This coverage is
known as:

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a) Medical Payments Liability.
b) Personal Umbrella Liability.

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c) Commercial General Liability.
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d) Professional Liability.
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35. A Commercial General Liability policy that pays for

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losses that occur during the policy period, regardless of

when the losses are reported is known as:
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a) An occurrence-based policy.
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b) An aggregate limit-based policy.

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c) A claims-made policy.
d) A full-limit policy.
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 36. Despite her excellent health, Mary-Ann had a mild
heart attack while on a driving holiday from her Ontario

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residence to Newfoundland. Which statement is correct?
a) Mary-Ann’s Ontario automobile policy will cover her

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emergency and in hospital health services.

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b) OHIP will not cover the emergency and in hospital
health services Mary-Ann requires.

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c) The Newfoundland / Labrador Medical Care Plan will

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cover Mary-Ann’s medical care costs without need for
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OHIP to be involved.
d) OHIP will cover Mary-Ann’s emergency and in hospital
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health services.
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nt
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np
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 37. Mary-Ann drove to Newfoundland to visit family. She
purchased Travel Health Insurance before leaving. Mary-

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Ann fell and fractured her leg in two places. She was
unable to drive back to her Ontario home. Which

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statement is correct?

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a) OHIP will not cover the emergency and in hospital
health services Mary-Ann requires.
b) OHIP will pay to fly Mary-Ann home and to have

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someone drive her car home.
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c) OHIP will not pay to fly Mary-Ann home or to have
someone drive her car home.
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d) Mary-Ann’s Ontario Automobile policy will pay her

medical and non-medical costs.
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nt
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np
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 38. Under the Ontario Health Insurance Plan (OHIP),
Ontario residents with a valid health card who meet the

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Ontario residency requirement to maintain their OHIP
coverage, are insured for emergency health services when:

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a) Travelling within Ontario only

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b) Travelling outside of Canada..
c) Travelling within one of Canada’s 10 provinces.

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d) Travelling within Ontario or another Canadian province
or territory.
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np
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 39. Louie purchased a Travel Health Insurance policy prior
to his trip to The Yukon to visit family. He suffered a stroke

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and was in hospital for a few days. As a result, he missed
his flight back to Ontario. Once cleared to travel, Louie had

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to re-schedule his return flight at a much higher fare than
his original return ticket. Which statement is false?

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a) OHIP will cover Louie’s emergency and in hospital health
services.

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b) OHIP will not cover the cost of Louie’s higher airfare.
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c) Louie’s Travel Health Insurance policy will reimburse
him for the increase in his airfare home.
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d) The Yukon’s Health Insurance Plan will not cover the

cost of Louie’s higher airfare.
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40. Which one of the following is not a source of

emergency health expense coverage?
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a) Bank debit or convenience card.

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b) Premium credit card.

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c) Employee group benefit plan.

d) All of the above provide this coverage.