RIBO Practice Exam Licensing Course

1. Following registration as an insurance broker, an individual:

A. Is required to report any changes in status only at each renewal of registration.
B. Is required to ensure that any change in his/her status is included in the next position report
filed by his/her employer.
C. Must confirm, in writing, every three (3) months to RIBO that there has been no change in the
information originally filed.
D. Must notify the Registered Insurance Brokers of Ontario if any information on the original
application for registration or renewal has become obsolete, including a change in employer,
and file a notice correcting that information within thirty (30) days of the change.

2. Upon successful completion of the examination you may qualify for registration as an insurance
broker. If issued, the registration will be "restricted to acting under supervision". Which one (1) of
the following most accurately describes the conditions under which you may act as an insurance
broker under supervision?
A. You may solicit insurance inside or outside your office but only in the community where your
office is located.
B. You may operate a trust account in your own name into which you may deposit premiums
you receive from policyholders.
C. You may solicit insurance only from persons who call at, or telephone your office
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 control trust funds.

3. The RIBO Code of Conduct is stated in Ontario Regulation 991, Section 14. Three (3) of the
following four (4) provisions are contained in the Code. Indicate the one (1) which is NOT.
A. To maintain a Trust Account for all trust money received. "
B. To be both candid and honest when advising the member's client.
C. Not to charge or accept any fee which is not fully disclosed prior to the service being
rendered.
D. To be competent to perform the services which the member undertakes on the client's behalf.

4. An individual who acts or aids in any manner in soliciting, negotiating or procuring the making of
any contract of insurance is required to be registered as an insurance broker if he or she:
A. Is licensed as an insurance agent, representing a single insurer and a Facility Association
B. Performs these duties as a favour to a friend who does not understand English.
C. Deals directly with the public and receives compensation.
D. Performs these duties on behalf of their employer with respect to the employer's own
insurance program.

5. RIBO Regulations stipulate that brokers must provide a policy or certificate of insurance to an
insured within a certain period after insurance has been placed. What is the length of that period?
A. Twenty-one (21) days.
B. Immediately
C. Ten (10) days
D. Thirty (30) days.

3/11/21 1
6. An Insurance Broker whose registration is restricted to acting under supervision may:
A. Prepare and sign RIBO Position reports on behalf of the insurance broker by whom he/she is
employed.
B. Operate a trust account for insurance premiums.
C. Be a “Principal Broker” as defined in Ontario Regulation 991
D. Solicit insurance from members of the public anywhere in Ontario.

7. An Individual is required to be registered as an insurance broker if he/she:

A. For compensation, provides risk management and loss prevention services on behalf of
another.
B. Acts solely as a reinsurance broker
C. For remuneration, transacts insurance solely on behalf of one insurer and a facility association
carrier
D. Recommends to friends they purchase insurance from a specific insurer because of the good
deal they obtained for insurance.

8. The RIB Act grants to the Discipline Committee of RIBO power to impose penalties on members
found guilty of misconduct, which is defined under Section 15(1) of Ontario Regulation 991. Which
one (1) of the following is NOT defined as “misconduct”?
A. Failure to carry on business in a manner consistent with the Code of Conduct.
B. Using an illustration, circulation or memorandum to represent the terms, benefits or
advantages of any policy or contract of insurance.
C. The payment of any referral fee or finder’s fee to any person who is not a registered insurance
broker or who is not registered or licensed under the laws of any jurisdiction to act as an
intermediary for insurance, other than life insurance.
D. Providing false or misleading information to R.I.B.O.

9. Which one (1) of the following would NOT be considered a peril under a Tenant’s
Comprehensive Policy:
A. Burglary
B. Fire
C. Storage of explosives
D. Windstorm

10. Which one (1) of the following does NOT have an insurable interest in a building owned by the
insured which is mortgaged?
A. The Mortgagee.
B. The Owner.
C. The Estate of the owner.
D. A Prospective purchaser of the property.

11. Which one (1) of the following statements is TRUE about insurers?
A. A stock company is owned jointly by the insureds.
B. The Facility Association is an insurance cooperative.
C. Mutual insurance companies are NOT required to be licensed by the Department of Insurance
D. Lloyd’s of London is NOT an insurance company

3/11/21 2
12. When an insured is indemnified by an insurer after a loss, it means:
A. The co-insurance conditions have been satisfied.
B. The subrogation efforts of the insurer against a third party have been satisfied.
C. The insured received the amount of his/her loss.
D. The insurer loses its right of subrogation

13. Where there is a co-insurance clause in a replacement cost policy, it is necessary to

determine:
A. The actual cash value of the property.
B. The original cost of the policy.
C. The amount which could be obtained for the property in a sale.
D. The replacement cost of the property.

14. If an insured requests mid-term cancellation of a policy, the insurer will:

A. Allow a pro-rata refund of a portion of the premium.
B. Make a note in the file not to renew.
C. Allow a short rate refund of a portion of the premium
D. Advise the insured the premium is fully earned.

15. Which one (1) of the following is a hazard as it pertains to insurance?

A. A claims-free history.
B. Plans to computerize the office.
C. Car drivers under age 25.
D. Bare electrical wires.

16. A fiduciary is:?

A. One who holds money or property in trust.
B. One who is honest and lives up to their word.
C. One who sells goods on their own behalf.
D. One who sells goods on behalf of someone else.

17. Which one (1) of the following perils may be insured under a property insurance policy?
A. Loss or damage caused by earthquake.
B. Loss or damage caused by the insured’s criminal acts
C. Loss or damage caused by war or invasion.
D. Loss or damage caused by a nuclear incident as defined in the Nuclear Liability Act.

18. The Sue and Labour Clause in an insurance policy is designed to:
A. Require the insurer to sue others who may be responsible for loss or damage to the insured
property.
B. Require the insurer to do some of the repair work to restore the property.
C. Point out to the insured their duty to take all reasonable steps in and about the recovery of the
property in return for agreement that the insurer will contribute to the cost.
D. Permit the insurer to sue the insured for failure to maintain the property in good condition.

3/11/21 3
19. Laws regulating the zoning, demolition, repair or construction of buildings and their related
services can increase costs of repair to buildings. These increased costs are:
A. Considered uninsurable.
B. Only insurable under an “All Risks” policy.
C. Partly covered under the 10% extension clause in most policies.
D. Insurable if specified in a property policy.

20. A Building worth $100,000 is insured for $60,000 under a policy with 80% co-insurance clause.
Fire damages the building to the extent of $90,000. How much would the insurer pay?
A. $60,000.
B. $48,000.
C. $50,000.
D. $67,500.

21. Freezer Foods coverage provides for payment of loss caused by spoilage of frozen foods
contained in your food freezer on your premises.
A. It covers actual cash value at current market prices up to $5,000 less deductible.
B. It is provided on an “All Risks” basis.
C. It excludes loss due to interruption of Hydro Service.
D. It covers only loss caused by mechanical breakdown of the freezer or outside power
interruption.

22. The Facility Association:

A. Is an Ontario Government- owned insurance company for bad automobile risks
B. Is a pooling arrangement of all automobile insurers who share the loss experience of the pool.
C. Is an insurer specializing in insuring only personal automobile risks.
D. Is an association of fifteen responsible insurers who provide insurance for substandard
automobile risks.

23. Which one (1) of the following classes of insurance is intended to indemnify a business for loss
of income due to fire damage to building, stock and equipment?
A. Accident and Sickness Insurance.
B. Property Insurance.
C. Business Interruption Insurance.
D. Liability Insurance.

24. Which one (1) of the following would protect your client against a loss due to the dishonesty of
an employee?
A. A hold-up policy.
B. A burglary policy.
C. A theft policy.
D. A fidelity policy.

3/11/21 4
25. Replacement Cost and Actual Cash Value are two different bases of indemnification for loss.
Which (1) ONE of the following statements is INCORRECT?
A. Actual Cash Value is the depreciated value shown in the Balance Sheet of a Financial
Statement.
B. Replacement Cost is usually paid only when replacement of the damaged property has been
completed.
C. Replacement Cost is a “new” value but Actual Cash Value is a “used” value.
D. Both values must be based on items of like kind and quality to the damaged property.

26. An insurer wishing to terminate an insurance policy may do so by:

A. Ordering the broker to issue a registered letter of cancellation.
B. Giving the insured 15 days notice by registered mail and refunding the unearned premium.
C. Refunding the entire policy premium.
D. Ordering the insurance broker to pick up the policy from the insured.

27 Subrogation is:
A. Following payment of a loss to the insured, the right of the insurer to seek recovery from any
other party responsible.
B. The percentage of risk taken by each insurer on a subscription policy.
C. Co-insurance where more where more than one property is destroyed in the same fire.
D. The insurer’s right to deny the claim.

28. Nearly every insurance policy has Policy Conditions which are common to all policies issued in
a particular class. Some policies contain Statutory Conditions. Which one (1) of the following
types of insurance has Statutory Conditions?
A. Fire insurance policy.
B. Liability insurance policy.
C. Burglary insurance policy.
D. Yacht insurance policy.

29. An insurer believes an insured has deliberately misrepresented a risk which it would not have
written had the insurer known the true facts. The premium has been paid in full and the policy has
been in force for three months. In voiding the policy the insurer would:
A. Refund the unearned premium as to the property to which the misrepresentation was made.
B. Refund the entire premium as to the property of which the misrepresentation was made.
C. Offer no refund with respect to any of the property.
D. Refund the excess over the minimum for the entire policy.

30. What is the purpose of a contract between an insurer and an insurance broker
(company/broker agreement)?
A. To formalize in writing what the broker and the insurer expect from each other.
B. To authorize the broker to operate a Trust Account.
C. To meet the requirements of RIBO.
D. To satisfy the requirements of the Department of Insurance.

3/11/21 5
31. The insurance industry is very particular about specific definitions describing various perils
under crime coverages. Which one (1) of the following would be considered a robbery loss?
A. Criminals hid themselves in your insured’s store when the store was closing for the evening.
They stole several valuable items of stock and took all of the change out of the cash register.
They then forced the rear door and escaped.
B. A group of violent people entered your insured’s store, threatened the clerks on duty with a
gun and carried away several items of stock and all the cash in the cash register.
C. An employee stole funds from the cash register while making change for a customer.
D. A customer entered your insured’s store and secretly carried out several items of merchandise
without paying for them.

32. The insured, under a property policy, goes bankrupt and there is a loss shortly thereafter.
Which (1) one of the following statements is TRUE?
A. Bankruptcy is considered a material change to the risk and the policy is therefore void.
B. The insurer is liable to pay the trustee in bankruptcy.
C. As the insured is bankrupt, the policy is void.
D. The loss would be paid by the Trustee in Bankruptcy.

33. In insurance terms, a peril is frequently described as a cause of loss. Which one (1) of the
following is NOT a peril.
A. Fire.
B. Windstorm.
C. Burglary.
D. Gasoline.

34. Where a loss occurs under an insurance binder before a policy has been issued, the insurer
will:
A. Take no action until a policy is issued.
B. Pay the claim in accordance with the coverages bound.
C. Demand that the broker pay the loss.
D. Cancel the binder by registered letter and deny liability,

35. The contents of a building are insured for $45,000 but valued at $100,000. The policy contains
a 90% co-insurance clause along with a $2,500 deductible clause. If fire damages the contents to
the extent of $8,000, how much would the insurer pay?
A. $7,000.
B. $1,500.
C. $8,000.
D. $5,500.

36. The deductible clause in an insurance policy:

A. Specified the amount in excess of which an insurer will pay a loss.
B. Always disappears when the loss exceeds a specified amount.
C. Is usually found in valued policies.
D. Is waived if the risk is insured to value.

3/11/21 6
37. A building owned by A. is sold for cash to B. Two days after the sale, a fire destroys the
building causing a loss of $100,000. Neither the broker nor the insurer were notified of the change
in ownership. The insurer would pay:
A. $80,000.
B. Nothing.
C. $50,000.
D. $100,000

38. A valued policy is one which:

A. Provides for replacement cost of the property irrespective of the amounts of the insurance.
B. Establishes, at the time the policy is issued, the amount of insurance the insurer will pay in the
event the property is totally damaged, lost or destroyed.
C. Is a special kind of policy, rarely issued and is therefore, highly “valued”.
D. Agrees to pay for the full value of the damage, however, caused.

39. The lessor of an automobile is:

A. The person or entity to whom the vehicle is leased.
B. The automotive dealer who sold the vehicle which was subsequently leased.
C. The employee who drives the leased automobile.
D. The owner from whom the vehicle is leased.

40. An insured’s house is destroyed by fire and due to local by-laws, has to be rebuilt with more
expensive materials. In the absence of a special endorsement indicate if the Homeowners
Comprehensive policy covers:
A. The cost plus 25% for improvements and betterments.
B. The increased cost to rebuild.
C. The cost plus 10% for improvements and betterments.
D. The cost to rebuild in the same manner and the same general materials as existed before the
loss?

41. Which one (1) of the following is a type of Business Interruption Insurance?
A. Builder’s Risk Insurance.
B. Named Perils Insurance.
C. All Risk Insurance.
D. Profits Insurance..

42. The insured decides to install a recreation room in the basement of the house. How may this
affect coverage under the insured’s Homeowners Comprehensive Policy?
A. The insurer must be notified, otherwise any loss involving the building will not be covered.
B. If the policy covers sewer back-up, that peril will no longer be insured.
C. Coverage under the policy will not be affected.
D. Losses to the recreation room will not be covered unless the insurer has been advised of the
change.

3/11/21 7
43. Loss or damage caused by earthquake is:
A. A coverage which may be added to a property policy for an additional premium.
B. Not insurable because it is considered an “act of God”.
C. One of the insured perils usually included in a property insurance policy.
D. Not available under a property insurance policy.

44. What purpose does a Proof of Loss serve when filed by the insured following a fire loss?
A. It is required to be filed with the Fire Marshall’s office to provide statistics about fire losses in
Ontario.
B. It provides the insurer with notice of the claim.
C. None.
D. The insured files it to “prove” the loss occurred and establish the value of the property
damaged or destroyed.

45. The agreement or contract between an insurance broker and an insurer usually authorizes the
broker to do one (1) of the following. Which is it?
A. Bind the insurer on acceptable risks.
B. Issue registered letters on behalf of the insurer to cancel policies.
C. Pay all claims on behalf of the insurer.
D. Establish their own rates and premium on the business they write.

46. Which one (1) of the following liability coverages is intended to protect an insured who is
planning to build a new home and will be sub-letting part of the contract to subcontractors?
A. Blanket contractual liability insurance.
B. Employers liability insurance.
C. Owner’s or contractor’s protective liability insurance.
D. Personal injury insurance.

47. A building worth $120,000 is insured for $60,000 under a fire policy with an 80% co-insurance
clause. Fire damages the building to the extent of $104,000. How much would the insurer pay?
A. $48,000.
B. $52,000.
C. $60,000.
D. $65,500

48. Which one (1) of the following coverages under a Homeowners Comprehensive policy
including Inflation Protection is NOT automatically increased in amount at the anniversary date of
the policy?
A. Additional Living Expense coverage.
B. Dwelling Building coverage.
C. Liability coverage.
D. Personal Property Coverage.

3/11/21 8
49. Improvements and Betterments made to a Condominium Unit by its owner are insured:
A. Under a blanket feature of the Condominium Corporation’s Master Policy.
B. Under coverage A3 of the individual Unit Owners Comprehensive Policy.
C. Under Building coverage of the Condominium Corporation’s Master Policy.
D. Under Coverage A1 of the Unit Owners Comprehensive Policy

50. Your client, John Smith insures his Condominium Unit through your office on a Comprehensive
form subject to a $200 deductible. He calls in a fire damage claim. Damage is estimated to be
$750 to replace a dishwasher, $1000 for the marble countertop and $250 to clean the cabinets.
How much will he recover under his policy?
A. $750 for the dishwasher, $250 for the cabinets, less the deductible
B. $2000 for the entire loss
C. $750 for the dishwasher, less the deductible
D. $1800 for the entire loss

51.Your clients advise you they have just purchased a set of matching antique candlesticks,
valued at $2,500 each. They have Canadian historical significance and they wish to insure them
specifically. You would recommend they:
A. Increase the limit of their contents coverage under their Homeowners policy.
B. Insure the items by means of a Fine Arts coverage endorsement added to the Homeowner
policy.
C. Add Personal Property Replacement Cost coverage to their Homeowners policy.
D. Purchase a Personal Effects Floater to cover the items.

52 Your insured owns a summer residence with a detached garage and tool shed. The property is
insured for Fire & Extended Coverage Perils under a Seasonal Dwelling form. What is the
maximum amount of insurance that could apply if one of these detached structures is destroyed by
fire?
A. The actual cash value of the destroyed structure without reference to the other structures.
B. That proportion of 10% of the amount of insurance on the dwelling building that the value of
the destroyed structure bears to the total value of both structures.
C. 10% of the amount of insurance on the dwelling.
D. 10% of the amount of insurance on the dwelling divided by the number of structures.

53. The Homeowners Comprehensive policy provides coverage for Voluntary Property Damage
when caused unintentionally by an insured person. This extension of coverage does NOT apply
where:
A. The damage occurs away from the insured premises.
B. The damaged property is rented from an establishment which rents equipment on a daily
basis
C. The insured person is under the age of twelve years.
D. The insured person is over the age of twelve years.

3/11/21 9
54 Under the Tenants Comprehensive policy, all of the following, EXCEPT ONE covers the
tenant’s own property. Mark the EXCEPTION.
A. Damage to the exterior of the building directly caused by vandalism or malicious acts.
B. Property temporarily removed from the residence for 14 days after a loss to protect it from
further damage.
C. Personal property damaged by change of temperature resulting from physical damage by an
insured peril.
D. Theft cover on money up to $500 and securities up to $2,000.

55. Which one (1) of the following does the Homeowners Comprehensive policy automatically
cover?
A. Private structures on the insured’s premises.
B. Personal belongings temporarily stored in a storage warehouse for all listed perils of the
policy.
C. Owned recreational vehicles.
D. Insured’s tools used in connection with his carpentry business, which he keeps at his place of
business.

56. Your insured has a Condominium Unit Owners Comprehensive Policy. While smoking in bed,
he/she negligently causes a fire in his/her unit. The fire spreads to the adjoining unit and the
occupant is overcome by smoke and dies. Under which section of the policy would the insurer
respond if a claim were made by the relatives of the deceased person?
A. Voluntary Medical Payments (Coverage F)
B. Personal Liability Coverage (Coverage E)
C. Loss Assessment (Coverage I)
D. Loss Assessment (Coverage A2).

57. An insurer has issued a vacancy permit on a vacant property. Which one (1) of the following
losses would continue to be insured by the policy covering the property?
A. Breakage of glass.
B. Vandalism.
C. Windstorm damage to the roof.
D. Water escape from the plumbing system.

58. A Tenant’s Comprehensive policy provides coverage for Voluntary Payment for Damage to
Property. This applies to only one (1) of the following situations. Which is it?
A. Damage to a ride-on lawnmower rented from a local rent-all establishment.
B. Property of others damaged unintentionally by the insured, even though not legally liable.
C. Damage caused by a guest, who backed an automobile into a portable barbeque which the
insured had borrowed from a neighbor.
D. Loss by theft from insured’s premises of a shotgun on loan from local sporting goods store.

3/11/21 10
59 A claim for Additional Living Expenses under a Homeowners Comprehensive Policy would
NOT be covered if which one of the following occurred?
A. The insured’s home is infested with termites and insured has to move out during the
extermination.
B. The Fire Department prohibits access after the home is severely damaged by fire.
C. The insured’s daughter starts a grease fire in the kitchen, causing extensive damage.
D. The insured incurs moving expenses after the home is severely damaged by vandalism.

60. Your insured owns one of each of the vehicles listed and seeks advice concerning coverage.
Which one (1) is covered under the Liability section of the Homeowners Comprehensive policy?
A. A trail bike.
B. A moped.
C. A snowmobile.
D. A motorized wheelchair.

61. Your insured advises he and his wife are moving to another city and intend to place their
furniture in storage while they look for a new apartment. They ask for advice about coverage
under the Tenants Comprehensive policy. You advise them:
A. Their policy will automatically cover their property in storage.
B. The property at the warehouse cannot be insured.
C. Their policy must be cancelled and re-written to accommodate the changed circumstances.
D. Their Tenants Comprehensive policy will cover all their property in the storage warehouse for
30 days but only against theft after that period.

62. Your client, Anna Thompson recently lost her husband. She has decided to sell her home an
purchase a Condominium Unit. She is inquiring what changes she will need to make to her
current Comprehensive Homeowners Policy. You would advise:
A. The Homeowners policy must be converted to a Condominium policy, which allows for extra
coverages she will require as a Unit Owner.
B. Endorse the change of address, delete the building and liability coverages, keeping the
Homeowners’ Policy because the unit and liability are covered by the Condominium
Corporations master insurance policy.
C. Any improvements made to the unit do not need to be included in her policy because they are
insured by the Condominium Corporations master insurance policy.
D. As the owner of the unit, she will be eligible for special rates on her Homeowner’s policy which
will simply be transferred to her new address.

63. Which one (1) is NOT true of the Replacement Cost Coverage under a Homeowners
Comprehensive policy?
A. Payment will be made without deduction for depreciation.
B. Replacement cost coverage for contents must be endorsed on to the policy.
C. Replacement cost coverage applicable to both the building and personal belongings insured
under the policy is basic coverage.
D. Replacement must be made with property of similar quality.

3/11/21 11
64. To what extent does Loss Assessment Coverage A2 in a Comprehensive Condominium Unit
Owners Policy cover an assessment against a unit owner?
A. Any assessment made by the Condominium Corporation as a contribution to cover the
deductible in the Condominium Corporations insurance.
B. Any covered assessment made by the Condominium Corporation, as additional insurance up
to the limit specified on Unit Improvements and Betterments.
C. Any assessment not exceeding $25,000, made in respect of any losses sustained by the
Condominium Corporation.
D. Any covered assessment made by the Condominium Corporation up to $10,000 or the limit
specified in the Unit Owners policy declarations.

65 A vacancy permit is required to continue fire insurance on a property where:

A. The occupant has taken a six-month vacation and left no one to take care of the residence and
its contents.
B. The occupants have moved out and do not intend to return.
C. The insured has moved out with one half of the contents and left his wife with only half of the
house furnished.
D. The occupant has been transferred to another location and resides in the premises only on
weekends.

66. A client comes into your office to arrange for a Travel Health policy. Your questioning reveals
he will be skydiving while on the trip. You tell him that he:
A. Will be fully covered by the policy
B. Will only received reduced benefits if injured while skydiving.
C. Is uninsurable.
D. Will not be covered while skydiving.

67. Travel Health insurance is based on O.H.I.P. being the primary payor. O.H.I.P. will normally
cancel coverage:
A. After 212 days of absence. Coverage will not be reinstated until 90 days after the traveler has
resumed residence in Ontario.
B. After 183 days. Coverage will not be reinstated until 90 days after the traveler returns.
C. Unless notified in advance of the extended stay.
D. After 180 days. Coverage will not be reinstated until the 1st day of the month following arrival
back home.

68 Travel Health policies contain certain limitations which it is important to be explained to

applicants for such insurance. Three (3) of the following are commonly found limitations. Indicate
the one (1) EXCEPTION.
A. Civil disorders, war or act of war (whether war be declared or not).
B. The medical condition of death of a person who is ill, when the purpose of the trip is to visit
that person.
C. Hospital or medical treatment where the policy is sought specifically for the purpose of
obtaining such treatment, whether recommended by a physician or not.
D. Continuing medical treatment if the insured is not medically fit to return to the country of
residence following emergency treatment.

3/11/21 12
69 Most travel health insurance providers may deny claims, or seriously curtail benefits if:
A. The insured fails to notify the insurer of a claim by way of a “Hot Line” number.
B. The insured refuses to be transferred home because he/she thinks the treatment is superb.
C. The attending physician has not submitted a bill in writing.
D. Any of the above occur.

70. When discussing travel health insurance with anyone, you would be wise to point out:
A. Travel health policies do not provide accidental death benefits.
B. Travel health policies may limit coverage and benefits for sickness or injury which does not
relate directly to an emergency.
C. Senior citizens are only eligible for travel health insurance if accompanied by an immediate
family member.
D. Benefits are payable for elective surgery.

71. Is a snowmobile considered to be an automobile for insurance purposes in Ontario?

A. No.
B. Only when being operated on a public highway.
C. Yes.
D. Not when being operated by an underage driver.

72. Your client calls to advise he/she needs insurance on a car leased from an automobile dealer.
Which one (1) of the following policies is required?
A. O.A.P. 1 Owner’s Form, suitably endorsed.
B. O.P.F. #2 Driver’s Form.
C. O.P.F. #6 Non-owned Automobile Form, suitable endorsed.
D. O.A.P. 4 Garage Auto Form, suitably endorsed.

73. Your insured is driving alone and is injured in an accident in the state of Georgia. The U.S.
driver is found 100% at fault. Your insured carries $1,000,000 liability coverage and the OPCF
#44 Family Protection Coverage. The other vehicle is covered for Bodily Injury $10,000 one
person $20,000 to two or more persons and $10,000 property damage. Your insured is awarded
$180,000 in damages for bodily injury. How much would be paid out under the OPCF #44?
A. $140,000
B. $180,000
C. $170,000
D. $160,000

74. Newly acquired automobiles are automatically covered under an O.A.P. 1 Owner’s Form
provided the insurer is notified:
A. As soon as practicable.
B. Within 14 days.
C. Within 7 days.
D. Within 21 days.

3/11/21 13
75. Insurance under O.A.P. 1 Owner’s Form, Section 7, Loss or Damage Coverages, is usually
subject to a deductible. It does not apply to damage caused by:
A. Windstorm
B. Explosion.
C. Vandalism
D. Fire.

76. Uninsured Automobile coverage:

A. Must be added by endorsement to O.A.P. Owners Form.
B. Only covers bodily injury, but never property damage.
C. Can cover accidental damage to the insured’s automobile, provided the uninsured owner or
driver of the other automobile is identified.
D. Provides coverage for third parties if the insured causes bodily injury and has breached a
statutory condition.

77. Your insured belongs to a car pool and uses his/her automobile to transport the other three
members to work every fourth week. One of the other members drives each of the other three
weeks. As his/her insurance broker, what would you recommend to make sure your client is
covered against claims from passengers for injures?
A. Add “passenger hazard endorsement”
B. The standard policy automatically covers the situation. No change is necessary
C. Advise the insurer to reclassify the vehicle to business use.
D. Add endorsement “carrying passengers for compensation or hire”.

78. Under the “What Automobiles Are Covered” section of O.A.P. 1 Owner’s Form, a newly
acquired automobile is automatically covered for a period of 14 days. This automatic coverage is
limited to:
A. Those coverages which applied to the vehicle replaced or which apply to all of the insured’s
vehicles if it is an additional automobile.
B. Private passenger vehicles only.
C. A vehicle which replaces one already insured under the policy.
D. Vehicles which are chiefly used for pleasure purposes.

79. All clients should be counseled regarding the availability of optional benefits available under
O.A.P. 1 Owner’s Form. Which one (1) of the following is NOT available?
A. Increased Income Replacement Benefit.
B. Excess Economic Loss Endorsement.
C. Indexation Benefit.
D. Increased Caregiver Benefit.

80. O.P.F. #6, Non-Owned Automobile Insurance Form is designed to protect:

A. An employer whose employees drive his/her vehicles which they do not own.
B. An employee who drives vehicles owned by his/her employer.
C. An employer whose employees drive their own vehicles in the course of his/her business.
D. An employer who occasionally drives one of his/her employees automobiles.

3/11/21 14
81. Indicate the correct way to insure a snowmobile.
A. Through an O.A.P. 1 Owner’s Form to cover all the exposures to be insured.
B. By an endorsement to a Homeowners or Tenants policy to cover the Third Party Liability and
a Personal Articles Floater for direct damage to the machine.
C. With an O.A.P. 1 Owner’s Form to cover Third Party Liability and Accident Benefits, and an
Inland Marine Floater for direct damage to the machine.
D. Through a Snowmobile Floater to cover all the exposures to be insured.

82. An insured requests that the limit of liability in his/her automobile policy O.A.P. 1 be reduced.
What is the minimum amount he/she must carry under Ontario Law.
A. $100,000/$300,000 – Bodily Injury, $50,000 – Property Damage
B. $500,000 inclusive.
C. $200,000 inclusive.
D. $100,000 inclusive.

83. A client phones to tell you he has bought a high-end stereo system costing $5,000 which has
just been installed in his car. What should you tell him?
A. Be sure to always lock the car as there is no coverage if the system is stolen when the car is
unlocked.
B. There is no coverage on the system without an approved security system in the car.
C. No further action is needed. The new system is automatically covered under the O.A.P. 1
Owner’s Form as part of the car.
D. To provide you with a copy of the invoice so you can have his O.A.P. 1 Owner’s Form
endorsed to cover its full value.

84. In the following statements about Section 6- Direct Compensation – Property Damage – of the
O.A.P. 1 Owner’s Form, one (1) is INCORRECT. Indicate which one it is:
A. The accident may occur anywhere in Canada and at least one of the other automobiles
involved is insured under an automobile insurance policy.
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.
C. It covers damage to the automobile, certain unscheduled trailers, their equipment and
contents caused by another automobile in Ontario, including their loss of use.
D. The policy on the other vehicle must be issued by an Ontario licensed insurer or one that has
filed with the Ontario Insurance Commission to provide this coverage.

85. Which one (1) of the following accidents would be considered a loss under Section 7.1.2.B,
Comprehensive of an O.A.P. 1 Owner’s Form policy?
A. Your insured’s windshield was smashed by a falling boulder while driving through a rock-slide
area.
B. You insured, while passing another vehicle at the entrance to a narrow bridge, struck the
bridge abutment.
C. Your insured severely damaged the undercarriage of his vehicle when he/she struck a pot-
hole in the roadway.
D. Your insured’s towing a trailer, stopped quickly and the trailer struck the rear of his/her
automobile damaging both vehicles..

3/11/21 15
86. The basic Income Replacement Benefit payable under O.A.P. 1 Owner’s Form, Section 4 –
Accident Benefits Coverage is $400 per week. The actual amount is based on:
A. 90% of Net Income.
B. 80% of Net Income.
C. 70% of Gross Income
D. 90% of Gross income

87. One of the following statements is correct. Which one (1) is it. Electronic accessories or
equipment are covered under O.A.P. 1 Owner’s Form:
A. For their full replacement cost.
B. Up to $2,500 is installed after the vehicle is purchased.
C. For their full actual cash value if factory installed.
D. For their full actual cash value.

88. How would you describe to your policyholder the purpose of OPCF #44 Family Protection
Coverage? It is designed to:
A. Indemnify an insured up to the limit of the insured’s policy for an amount he/she is legally
entitled to recover for bodily injury or death from an inadequately insured Third Party.
B. Ensure protection to the insured for injuries to any passengers resulting from the insured
purchasing inadequate coverage limits.
C. Provide flexibility in the insured’s coverage in case it is inadequate to meet the costs resulting
from the use or operation of the insured vehicle.
D. Provide additional third party liability insurance if the insured is involved in an accident in a
state or province where the statutory minimum limits are higher than those being carried.

89. Insurance under Section 7 of O.A.P. 1 Owner’s Form, Loss or Damage Coverages, is usually
subject to a deductible. It does not apply to loss or damage caused by:
A. Water.
B. Lightning.
C. Vandalism
D. Windstorm

90. Your insured calls to report while ice fishing on Lake Simcoe his/her automobile went through
the ice. He/she has O.A.P. 1 Owner’s Form with Liability, Accident Benefits and Comprehensive
Coverages. The insurer:
A. Would pay the claim in full.
B. Would not pay the claim as there is no coverage.
C. Would pay the claim less the deductible.
D. Would not pay the claim as the automobile was not being operated on a public highway.

3/11/21 16
 Case Study

Answer the following questions on the paper provided. Only brief answers are required.
DO NOT ATTEMPT TO GIVE ANSWERS IN GREATER DEPTH THAN IS CALLED FOR BY
EACH PART OF THE QUESTION.

Mark and Mary White own a single-family home and live in it with their son Bart, aged twenty-
three. It is insured under a Homeowners Comprehensive policy. Mary gives private piano lessons
in the living room using the $20,000 grand piano she inherited from her grandmother. Mark owns
a 2001 Buick Regal with mandatory coverages and all perils.

(1) (a) Is there any coverage for damage to the piano under Section 1 Coverage C of the
policy? If so, describe it.
One Mark
(b) Explain the best way to insure the piano.
One Mark
(2) (a) Can the policy provide coverage to protect Mary in case pupils should be
accidentally injured on her premises and she is found liable for their injuries?
One Mark
(b) Explain your answer.
One Mark
(3) They have heard that “Acts of God” are not insured. Would they be insured if a
windstorm were to damage their property?
One Mark
(4) Bart has just received his license. Will he have to buy his own policy to drive his
father’s car?
One Mark
(5) The family is planning to drive through the U.S.A. and Mexico for a holiday. What
would you tell Mark when he asks you if their auto policy will cover them?
i. In the U.S.A.?
One Mark
ii. In Mexico?
One Mark
(6) If Mary buys a new car on Friday but fails to notify you until Monday would she be
insured over the weekend?
One Mark
(7) Usually the family car is parked in the garage. If it should be left outside on the
driveway occasionally and be stolen before you are notified, would it affect the
coverage?
One Mark

3/11/21 17
 Broker Practice Exam Answers

A B C D
1 X
2 X
3 X
4 X
5 X
6 X
7 X
8 X
9 X
10 X
11 X
12 X
13 X
14 X
15 X
16 X
17 X
18 X
19 X
20 X
21 X
22 X
23 X
24 X
25 X
26 X
27 X
28 X
29 X
30 X
31 X
32 X
33 X
34 X
35 X
36 X
37 X
38 X
39 X
40 X
41 X
42 X
43 X
44 X
45 X
46 X
47 X
48 X
49 X

6/24/21
 50 X
51 X
52 X
53 X
54 X
55 X
56 X
57 X
58 X
59 X
60 X
61 X
62 X
63 X
64 X
65 X
66 X
67 X
68 X
69 X
70 X
71 X
72 X
73 X
74 X
75 X
76 X
77 X
78 X
79 X
80 X
81 X
82 X
83 X
84 X
85 X
86 X
87 X
88 X
89 X
90 X

6/24/21