Practice

All five sections, shuffled

131 free questions, every section mixed together, in the shape of the real paper. Each one comes back with its explanation. Most carry the provision they rest on, as a link into the law on this site. The others are written from a standard policy wording, which is not law and is not reproduced here, so they carry the explanation alone.

All 131 free questions in this run

Under the Compulsory Automobile Insurance Act, every insurer is a member of the Facility Association.
- A True Correct
- B False
Membership is not a choice under the Act, which states that every insurer is a member of the Association, and every member must in turn comply with the Plan and the Association's articles, by-laws, rules and resolutions.

CAIA, s. 7 (2)
What is the Plan of Operation that the Facility Association must establish?
- A A government backed pool that pays claims where a member insurer becomes insolvent
- B A plan for providing automobile insurance to owners, lessees and licensed drivers who could not otherwise obtain it Correct
- C A schedule of the maximum rates that every member insurer must charge for the automobile insurance it writes in Ontario
- D A voluntary arrangement under which member insurers share the cost of catastrophic claims
The Compulsory Automobile Insurance Act requires the Facility Association to set out in its articles of association a Plan of Operation providing a contract of automobile insurance to owners, lessees and licensed drivers who could not otherwise obtain one, which is what makes it the market of last resort.

CAIA, s. 7 (3)
A personal support worker is injured in a collision and can no longer look after the client they are paid to care for, who lives in a different house. Their own policy, renewed after July 1, 2026, carries the optional caregiver benefit. Do they qualify for it?
- A Yes, because they were the primary caregiver for a person in need of care at the time of the accident and can no longer do that work.
- B Yes, provided their employer confirms that no replacement worker was available to take over.
- C No, because a caregiver benefit is payable only to a parent caring for their own child.
- D No, because the benefit requires the insured person to have lived with the person in need of care and to have been unpaid. Correct
The caregiver benefit needs three things to line up at the time of the accident: residing with the person in need of care, being that person's primary caregiver, and receiving no remuneration for the caregiving, so paid work for someone in another household fails two of the three.

SABS, s. 13 (1)
Under the Statutory Accident Benefits Schedule (SABS), which disability test must an insured person meet to qualify for a non-earner benefit?
- A A complete inability to carry on a normal life as a result of and within 104 weeks after the accident, where they do not qualify for an income replacement benefit Correct
- B A substantial inability to carry on a normal life as a result of and within 104 weeks after the accident, whether or not they qualify for an income replacement benefit
- C A substantial inability to perform the essential tasks of their employment at the time of the accident
- D Unemployment at the time of the accident, with no medical test to be satisfied
The non-earner benefit turns on a complete inability to carry on a normal life arising as a result of and within 104 weeks after the accident, in a person who does not qualify for an income replacement benefit. For policies issued or renewed on or after July 1, 2026 it is one of the optional benefits every insurer must offer.

SABS, s. 12 (1)
Under the Ontario Automobile Policy OAP 1, what determines whether a particular coverage applies to a specific automobile?
- A The wording of the policy booklet describes the coverage and the insured received that booklet.
- B The Certificate of Automobile Insurance shows a premium for that coverage, or shows the coverage is provided at no cost. Correct
- C The insured named the coverage in the signed application for automobile insurance.
- D The insurer accepted the risk and issued the policy without expressly excluding the coverage.
Section 1.1 of the Ontario Automobile Policy OAP 1 makes the Certificate of Automobile Insurance the document that switches a coverage on, so a coverage exists for an automobile only where the Certificate shows a premium for it or shows it at no cost.

OAP 1, Section 1.1
Marc is stopped at a red light when another driver rear-ends him. The other driver admits fault at the scene and both cars are damaged. Marc is annoyed but not hurt and has not decided whether to claim. What does the Ontario Automobile Policy OAP 1 require him to do?
- A Report the accident to his agent, broker or insurance company within seven days, even though he was not at fault. Correct
- B Report the accident to his agent, broker or insurance company within 24 hours because property was damaged.
- C Report the accident only if he decides to make a claim under his own policy.
- D Report the accident to his agent, broker or insurance company within 30 days of the accident.
Section 1.4.4 of the Ontario Automobile Policy OAP 1 sets a seven day reporting duty for any accident involving injury or property damage and says it applies regardless of who is at fault, so a not-at-fault insured still has to report.

OAP 1, Section 1.4.4
Wanda drives from Ontario into a United States state where the required minimum liability limit is higher than the $500,000 limit shown on her Certificate of Automobile Insurance. She causes an accident there. How does her Ontario Automobile Policy OAP 1 respond?
- A The insurer honours the higher minimum limit required in that jurisdiction. Correct
- B The insurer pays the $500,000 limit and Wanda is personally responsible for the difference.
- C The insurer pays no more than the $500,000 limit shown on the Certificate.
- D The policy does not respond at all, because coverage in another jurisdiction needs an endorsement.
Section 3.3.3 of the Ontario Automobile Policy OAP 1 says that where an incident happens in a covered jurisdiction whose required minimum liability limit is higher than the limit on the Certificate, the insurer honours the higher amount, so the Ontario limit does not cap the payment.

OAP 1, Section 3.3.3
A property policy issued in Ontario prints a condition that cuts back one of the statutory conditions. Under section 148 (1) of the Insurance Act, what is the effect of that printed wording on the insured?
- A It does not bind the insured, because no variation, omission or addition to a statutory condition is binding on the insured Correct
- B It governs the claim, because the insured accepted the policy as issued
- C It binds both parties once the insurer has filed the wording with the regulator
- D It makes the entire policy void, because a statutory condition cannot be altered
Section 148 (1) deems the statutory conditions to be part of every contract in force in Ontario and requires them to be printed in the policy, then states that no variation, omission or addition binds the insured, so the cut-back wording simply fails against the insured while the rest of the policy stands.

Insurance Act, s. 148 (1)
Under a typical habitational wording, what does a named perils form insure?
- A Every cause of loss the policy does not specifically exclude
- B Any cause of loss the insured can show was sudden and accidental
- C The perils listed in the form, without any further qualification once the peril is shown
- D Direct loss caused by the perils it lists, each as described and limited Correct
A named perils form insures against direct loss or damage caused by the perils it lists, and the phrase as described and limited means each peril carries its own definition and carve-outs, so being on the list is not the end of the question.
What does OPCF 43 change about the way a loss or damage claim on the described automobile is settled?
- A It removes the insurer's right to deduct depreciation from the value of the automobile. Correct
- B It removes the deductible shown on the Certificate of Automobile Insurance for that automobile.
- C It fixes the value of the automobile at the figure written on the change form.
- D It pays the cost of a replacement automobile without regard to the original purchase price.
OPCF 43 takes away the insurer's right under the policy's what we will pay rule to deduct depreciation from the value of the automobile, so the settlement is worked out without that reduction while the deductible on the Certificate still applies.

OPCF 43, Section 1
Your client's property policy shows a bank as mortgagee, and the loss was made payable to the bank with the insurer's consent. The insurer terminates the policy for non-payment of premium and sends the termination notice to the client alone. Two weeks later the dwelling burns. Under section 147 of the Insurance Act, what is the bank's position?
- A The insurer could not cancel the policy to the bank's prejudice without giving notice to the bank Correct
- B Notice to the named insured was enough, because the bank is not a party to the contract
- C The bank was entitled to twice the notice period given to the named insured
- D The bank's interest ended automatically when the insured stopped paying the premium
Section 147 (1) bars an insurer from cancelling or altering the policy to the prejudice of a consented loss payee without notice to that person, and section 147 (2) makes the length and manner of that notice the same as notice of cancellation to the insured, so the bank had to be told separately.

Insurance Act, s. 147 (1)
A brokerage hires an unlicensed trainee. The principal broker will be away for two weeks and asks a Level 1 licensee in the office to act as supervising broker for the trainee's work while she is gone. What does By-Law No. 3 say about that plan?
- A A Level 1 licensee may act as supervising broker for up to 30 days during a principal broker's absence.
- B A Level 1 licensee may supervise anyone who is not registered, but not another licensee.
- C A Level 1 licensee cannot act as principal broker, deputy principal broker or supervising broker. Correct
- D A Level 1 licensee may act as supervising broker after completing 24 months of registration.
Section 3.3 of By-Law No. 3 has a Level 1 licensee act under the supervision of a principal broker and while employed or sponsored by an active firm, and it bars that licensee from the principal broker, deputy principal broker and supervising broker roles, so the plan cannot go ahead.

By-Law No. 3, s. 3.3(a), (b)
A client leaves a bedroom window open on a summer evening. A thunderstorm drives rain in through the open window and soaks the carpet and the bed. The building itself is undamaged. Under a typical habitational wording on a named perils form, does the windstorm or hail peril respond?
- A Yes, because the wind is the reason the rain got inside the house
- B No, because interior damage needs the storm to create the opening first Correct
- C Yes, because coincidental rain damage is part of the windstorm peril
- D No, because rain damage is outside every habitational form of coverage
The windstorm or hail peril does not reach personal property or the interior of a building damaged by wind, hail or coincidental rain unless the storm has first created an opening, and a window the client left open is not a storm created opening.
Which minimum amounts must a brokerage maintain under section 20 of Regulation 991? Select all that apply.
- A Fidelity insurance of at least $500,000 in respect of any one occurrence.
- B Errors and omissions insurance of at least $1,000,000 in respect of any one occurrence.
- C Fidelity insurance against losses arising from dishonesty of employees, a proprietor or partners, directors, officers and shareholders of at least $100,000 in respect of any one occurrence. Correct
- D Errors and omissions (E&O) insurance with extended coverage for loss resulting from fraudulent acts, or another approved financial guarantee, of at least $3,000,000 in respect of any one occurrence. Correct
Section 20 of Regulation 991 sets two separate minimums, because subsection (1) calls for at least $3,000,000 per occurrence of errors and omissions cover or another approved financial guarantee, and subsection (2) calls for at least $100,000 per occurrence of fidelity insurance.

O. Reg. 991, s. 20(1)
Under the Ontario Automobile Policy OAP 1, what time limits apply to a person applying for Accident Benefits?
- A Tell the insurer within 24 hours of the accident, and return the completed application within 14 days of receiving it.
- B Tell the insurer within 60 days of the accident, and return the completed application within 60 days of receiving it.
- C Tell the insurer within 30 days of the accident, and return the completed application within seven days of receiving it.
- D Tell the insurer within seven days of the accident, and return the completed application within 30 days of receiving it. Correct
Section 4.2.1 of the Ontario Automobile Policy OAP 1 pairs a seven day notice of the accident with a 30 day period to return the completed application, so the shorter clock runs first and the longer one starts when the form arrives.

OAP 1, Section 4.2.1
What does OPCF 28 do while a named person is driving the described automobile?
- A It excludes all coverage apart from certain Accident Benefits while that person is driving.
- B It reduces the coverages, limits and amounts for Liability and Loss or Damage shown on the Certificate. Correct
- C It moves the Liability coverage onto the named person's own policy for the duration of the trip.
- D It suspends the policy for the described automobile until the named person stops driving it.
OPCF 28 keeps the named person insured but on reduced terms, because while that person drives, the Liability and Loss or Damage coverages, limits and amounts shown on the Certificate drop to the figures written on the change form.

OPCF 28, Section 1
A client's car is destroyed by an engine bay fire. The policy carries Comprehensive with a $1,000 deductible, and OPCF 40 is attached. How is the claim settled?
- A In full, because a loss caused by fire carries no deductible under the policy wording.
- B In full, because OPCF 40 applies only where a third party set the fire deliberately.
- C Less the $1,000 Comprehensive deductible, because OPCF 40 applies that deductible to each Section 7 fire claim. Correct
- D Less half the Comprehensive deductible, because OPCF 40 splits the fire deductible between insurer and insured.
Without the endorsement the policy pays a fire loss with no deductible, but OPCF 40 has the insured agree that the deductible shown for Specified Perils, Comprehensive or All Perils applies to each Section 7 fire claim, so the client carries the $1,000.

OPCF 40, Section 1
While checking a renewal a broker notices that the insurer has applied a rating credit the client does not qualify for, which has lowered the premium. Which principle of the code of conduct in Regulation 991 speaks most directly to how the broker treats the insurer here?
- A A member shall hold in strict confidence all information acquired in the course of the professional relationship.
- B A member owes a duty to the client to be competent to perform the services the member undertakes on the client's behalf.
- C A member shall discharge the member's duties to clients, members of the public, fellow members and insurers with integrity. Correct
- D A member shall make the member's services available to the public in an efficient and convenient manner.
The first principle of the code of conduct in section 14 of Regulation 991 requires integrity toward insurers as well as toward clients, members of the public and fellow members, so the broker cannot quietly accept a credit the client has not earned.

O. Reg. 991, s. 14, para. 1
A client's own child is hurt falling down the stairs at home. Under a typical habitational wording, the liability part of the policy responds to that injury. Is that statement correct?
- A True
- B False Correct
The wording excludes bodily injury to the insured or to any person residing in the insured's household other than a residence employee, because liability insurance answers claims by third parties rather than injuries inside the family.
Under a typical habitational wording, how is the word tenant defined where the vandalism and theft perils exclude damage caused by a tenant?
- A A person who has signed a written lease for the dwelling
- B Any person who has the insured's permission to occupy the dwelling or any part of it Correct
- C Any person who pays the insured something in return for the use of the dwelling or part of it
- D A person shown as a tenant on the coverage summary page
The wording gives the exclusions their own definition, which reaches any person with the insured's permission to occupy the dwelling or part of it, so a house guest or a short term rental guest is caught without any lease or payment.
Heavy rain overloads the municipal system and sewage backs up through the floor drain into a client's basement. His policy carries a named perils form and no water endorsement. Under a typical habitational wording, does the water escape, rupture and freezing peril respond?
- A No, because that peril excludes backup, escape or overflow from a sewer, sump or septic system Correct
- B Yes, because water escaped inside the dwelling rather than outside it
- C Yes, because the floor drain forms part of the plumbing system
- D No, but the windstorm peril answers the loss instead, because the heavy rain is what caused it
The water escape peril carves out backup, escape or overflow of water or sewage from a sewer, sump, septic system or connected eavestrough, and from drains or sewers outside the dwelling, which is the reason a sewer back-up endorsement is sold.
For policies entered into or renewed on or after July 1, 2026, which benefits must every insurer offer as optional benefits under Part II of the Statutory Accident Benefits Schedule (SABS)?
- A The income replacement benefit, the non-earner benefit and the caregiver benefit. Correct
- B The death benefit, the funeral benefit and the caregiver benefit.
- C The income replacement benefit only, with the non-earner and caregiver benefits remaining standard.
- D The medical benefit, the rehabilitation benefit and the attendant care benefit.
Section 4.1 of the Statutory Accident Benefits Schedule (SABS) requires every insurer to offer an income replacement benefit, a non-earner benefit and a caregiver benefit as optional benefits, so from July 1, 2026 those three are bought rather than included automatically.

SABS, s. 4.1 (1)
Under statutory condition 6 of the Insurance Act, what must an insured do after a covered loss, in addition to giving written notice of the loss forthwith?
- A Deliver a proof of loss to the insurer as soon as practicable, verified by a statutory declaration Correct
- B Telephone the broker within 24 hours and confirm the details of the loss verbally
- C Obtain two independent repair estimates before the insurer attends the site
- D File the proof of loss with the court within sixty days after the loss
Statutory condition 6 (1) sets two separate obligations after a loss: notice in writing forthwith under clause (a), and delivery of a proof of loss verified by a statutory declaration as soon as practicable under clause (b), so a sworn document is required on top of the notice.

Insurance Act, s. 148, Statutory Condition 6 (1) (Requirements After Loss)
Under a typical habitational wording, when does Coverage F, voluntary medical payments, respond?
- A Only after a court has found the insured to be legally liable for causing the injury
- B Where the insured unintentionally hurts someone, or someone is hurt on the premises Correct
- C Only where the injured person has no other medical coverage of any kind
- D Where the insured admits fault to the injured person in writing first
Coverage F pays reasonable medical expenses incurred within one year of the accident where the insured unintentionally injures another person or someone is accidentally injured on the premises, so it operates without any finding of legal liability.
In the standard vocabulary of home insurance, how is a peril described?
- A A chance event, unexpected and accidental from the policyholder's viewpoint Correct
- B The damage that property suffers when a loss happens
- C Any event that the policy happens to name, whether or not it was foreseeable at all
- D The financial consequence the policyholder bears after a loss
A peril is the cause of loss rather than the damage, and the requirement that it be unexpected and accidental is the fortuity principle, which is why shingles wearing out or a fence rotting is not an insured peril.
Under FSRA Rule 2020-001, misleading advice given to a client only in conversation, with nothing put in writing, falls outside the misrepresentation provision. Is that statement true or false?
- A True
- B False Correct
Section 8(1) applies to information, promotional materials or advice in any form, and it lists audio, visual, electronic, written and oral means, so spoken advice is inside the provision on the same terms as a printed brochure.

FSRA Rule 2020-001, s. 8(1)
Under the Occupiers' Liability Act, what notice must be given before an action may be brought for personal injury caused by snow or ice?
- A Written notice of the claim, including the date, time and location, served personally or sent by registered mail within 60 days of the injury. Correct
- B Written notice of the claim, including the date and location, served personally within 10 days of the injury.
- C Written notice of the claim, including the date, time and location of the occurrence, sent by ordinary mail within 6 months of the injury.
- D No notice, provided the action is started within the ordinary limitation period for a personal injury claim.
Section 6.1(1) bars the action unless, within 60 days after the injury, written notice of the claim including the date, time and location of the occurrence has been personally served on or sent by registered mail to at least one of the persons listed in section 6.1(2).

Occupiers' Liability Act, s. 6.1(1)
Under a typical habitational wording, what does a sewer back-up endorsement insure?
- A Any water that enters the dwelling from outside it during a storm
- B Sudden and accidental backing up of water or sewage from a drain or sump inside Correct
- C The failure of a municipal water main in the street immediately outside the property
- D Water that seeps through the basement wall steadily over a season
The endorsement insures property under Coverages A, B and C against sudden and accidental backing up or escape of water or sewage within the dwelling or detached structures, and the word within matters because the failure has to happen inside the building.
In the common four level description of home coverage, what does the basic level, also called named perils, provide?
- A Cover for the building only, with contents insured separately
- B Cover only for the perils the policy specifically states Correct
- C Cover for all risks except those specifically excluded
- D Cover for properties that fall short of normal insurance standards
Basic and named perils are the same level under two names, so the insured has to bring the loss inside one of the perils the policy states rather than pointing at the absence of an exclusion.
Your client starts renting out the basement of their owner-occupied home, a change material to the risk and squarely within the client's control and knowledge. The client notifies the insurer in writing the same week. The insurer writes back saying the contract can continue if the client pays an additional premium. Under statutory condition 4 of the Insurance Act, by when must the client pay it?
- A Within fifteen days after the client receives the insurer's notice Correct
- B Within fifteen days after the tenant moved into the basement
- C Within thirty days after the client receives the insurer's notice
- D At the next renewal of the contract
Statutory condition 4 lets the insurer respond to a notified material change by asking for an additional premium, and the clock it sets is fifteen days from receipt of the insurer's notice, so the period runs from that notice rather than from the change itself.

Insurance Act, s. 148, Statutory Condition 4 (Material Change)
In the common four level description of home coverage, what does the comprehensive level provide?
- A Building and contents insured for all risks except those specifically excluded Correct
- B Building and contents insured against only the perils the policy lists
- C Building insured for all risks and contents insured against listed perils
- D Building and contents insured for all risks, with flood and earthquake included
Comprehensive is the top of the four levels, but it is not everything: the exclusions still apply, and flood, earthquake and sewer backup remain optional coverages a client buys on top.
Under the Insurance Act, on what basis may an automobile insurer decline to issue, terminate or refuse to renew a contract, or refuse to provide a coverage or endorsement?
- A Only on a ground filed with the Chief Executive Officer under the Act. Correct
- B On any ground set out in the insurer's own published underwriting manual.
- C On any ground the insurer applies consistently across its book of business.
- D Only on a ground approved in advance by the Facility Association.
Section 238(1) bars an insurer from declining to issue, terminating or refusing to renew a contract, or refusing to provide or continue a coverage or endorsement, except on a ground filed with the Chief Executive Officer, which is the statutory basis of the take all comers obligation.

Insurance Act, s. 238(1)
Home insurance coverage is commonly described as dividing into two broad categories before any level of coverage is chosen. What are those two categories?
- A Building coverage and contents coverage
- B Named perils coverage and all risks coverage
- C Property coverage, liability coverage and additional living expenses
- D Personal property coverage and personal liability coverage Correct
The property half covers loss of or damage to the things the client owns and the liability half covers what the client owes somebody else, which is the same line a habitational wording draws between its property section and its liability section.
A tenant asks whether the building owner's insurance will replace her furniture if overland flooding gets into her apartment. What is the correct answer?
- A Yes, because the building owner's policy insures everything kept inside the building
- B Yes, provided she reports the loss to the owner within a set period
- C No, because a landlord's insurance does not cover a renter's own belongings Correct
- D No, because overland flooding cannot be insured by a tenant at all
A landlord's policy insures the landlord's interest, so a renter who wants protection for personal property against overland flooding has to arrange it under a policy of her own.
A client asks whether her home policy will answer if the river behind her house comes up into the basement. Which statement describes the general position on home and tenant policies?
- A Water damage is a basic coverage, while flooding is not typically part of a standard policy Correct
- B Both water damage and flooding are basic coverages on every home policy
- C Neither is insured unless the client buys a separate water endorsement
- D Flooding is covered as standard, and burst pipes are the one loss that needs a separate endorsement
Public Safety Canada's guidance for householders states that water damage is a basic coverage on home and tenant policies covering incidents such as burst pipes and hot water tank leaks, and that flooding is not typically part of a standard policy.
An Ontario resident who owns a car asks a broker for automobile insurance. The broker expects every insurer she deals with to decline the risk. Under the Compulsory Automobile Insurance Act, what must the broker do?
- A Explain that no market is available and decline to take the enquiry further.
- B Provide the person with an application for automobile insurance and submit the completed application to an insurer. Correct
- C Refer the person directly to the Financial Services Regulatory Authority of Ontario (FSRA) for assistance.
- D Take the application but hold it until an insurer confirms it will consider the risk.
Section 5 obliges an agent, when requested by an Ontario resident owner or lessee, to provide an application for automobile insurance and to submit a completed application to an insurer, so a broker may not screen a driver out by refusing to hand over the form.

Compulsory Automobile Insurance Act, s. 5
A dog with two owners bites a neighbour. Under the Dog Owners' Liability Act, how does liability fall between them?
- A They are jointly and severally liable. Correct
- B Only the owner recorded on the municipal licence is liable.
- C Only the owner who was in control of the dog at the time is liable.
- D Each is liable for half of the damages to the injured person.
Section 2(2) provides that where there is more than one owner of a dog they are jointly and severally liable under the section, so the injured neighbour may look to either of them for the whole of the damages.

Dog Owners' Liability Act, s. 2(2)
Under the Dog Owners' Liability Act, what damages is a dog owner liable for?
- A Damages resulting from a bite or attack by the dog on another person or domestic animal. Correct
- B Damages resulting from a bite on a person only, since animals are property.
- C Damages resulting from any injury the dog causes, including damage to fences and gardens.
- D Damages resulting from a bite where the owner knew the dog had bitten before.
Section 2(1) makes the owner of a dog liable for damages resulting from a bite or attack by the dog on another person or domestic animal, so harm to another animal is inside the section as much as injury to a person.

Dog Owners' Liability Act, s. 2(1)
Under the Compulsory Automobile Insurance Act, what obligation does membership in the Facility Association place on an insurer?
- A To accept a fixed share of the Plan's business in each year regardless of its own underwriting capacity to write it.
- B To maintain a separate reserve fund approved by the Chief Executive Officer for Plan business.
- C To comply with the Plan and the articles of association, by-laws, rules and resolutions of the Association. Correct
- D To appoint one of its own officers to the Association's board of directors.
Section 7(3.1) requires every member of the Association to comply with the Plan and with the articles of association, by-laws, rules and resolutions of the Association, which is what makes the Plan workable across the whole market.

Compulsory Automobile Insurance Act, s. 7(3.1)
A broker gives the Registered Insurance Brokers of Ontario (RIBO) an inaccurate answer during a routine file review about a matter that turns out to be trivial. Under Regulation 991, what follows?
- A Nothing, because the underlying matter did not itself amount to misconduct.
- B Nothing, provided the broker corrects the answer before the file review closes.
- C The answer is treated as misconduct only where it was given under oath or by a sworn affirmation.
- D Providing false or misleading information to the Corporation is misconduct in its own right. Correct
Paragraph 14 of section 15(1) makes providing false or misleading information to the Corporation misconduct on its own, so the answer is judged separately from whatever it was about and a minor underlying matter does not excuse it.

O. Reg. 991, s. 15(1), para. 14
Under the code of conduct in Regulation 991, how is a broker's duty of competence framed?
- A The broker must hold the highest registration level available for the class of business.
- B The broker must be competent to perform the services the broker undertakes on the client's behalf. Correct
- C The broker must complete the continuing education hours set for the year before taking new business.
- D The broker must obtain the principal broker's approval before accepting an unfamiliar risk.
Paragraph 2 of the code owes competence to the client and measures it against the services the broker undertakes, so accepting work the broker is not competent to perform breaches the code at the moment of acceptance rather than when something goes wrong.

O. Reg. 991, s. 14, para. 2
The Registered Insurance Brokers Act requires Council to establish certain committees. Which of the following does the Act require? Select all that apply.
- A One or more Complaints Committees Correct
- B A Discipline Committee Correct
- C An Audit Committee
- D An Appeals Committee
- E A Qualification and Registration Committee Correct
Section 12(1) requires Council to establish a Qualification and Registration Committee, one or more Complaints Committees and a Discipline Committee, and allows but does not require Council to establish other committees it considers necessary.

RIB Act, s. 12(1)
Under the Registered Insurance Brokers Act, how does an individual member resign, and what is the effect?
- A By filing a written resignation with the Manager, whereupon the registration is cancelled. Correct
- B By letting the registration lapse at the next annual renewal date.
- C By giving the Qualification and Registration Committee three months written notice.
- D By filing a written resignation with the Manager, which takes effect at the end of the registration year.
Section 5(2) lets an individual member resign by filing a resignation in writing with the Manager, and the word thereupon means the registration is cancelled as soon as that filing is made rather than at any later date.

RIB Act, s. 5(2)
A client tells his broker he is moving to Spain for at least three years and asks about medical cover there. Travel insurance is not intended to be used when a person is living outside Canada for an extended period or permanently, and local laws may require that he have medical insurance where he settles. Is that statement true or false?
- A True Correct
- B False
Travel insurance is built around a trip, and federal guidance states it is not intended to be used when a person is living outside Canada for an extended period or permanently, so someone moving abroad has to consider his insurance needs where he settles, because local laws may require that he have medical insurance and a visa application may ask for proof of it.
Under Regulation 991, what mailing address must a broker who carries on business, or who is employed by a member carrying on business, register for the purposes of the Registered Insurance Brokers Act?
- A Any address in Ontario at which the broker can reliably receive registered mail.
- B The broker's home address, so that service can be effected personally.
- C A post office box maintained in the name of the brokerage.
- D The address where the business is carried on, and it may not be a post office box number. Correct
Section 24(1) requires the mailing address maintained for the purposes of section 28 of the Act to be the address where the business is carried on and not a post office box number, which is what makes service by registered mail effective under sections 28 and 29 of the Act.

O. Reg. 991, s. 24(1)
In February a broker realises that the client's business interruption limit was set on a figure two years out of date and is now well short of what a full shutdown would cost. She decides to raise it at the August renewal. In March the client asks her whether the policy still fits the business and she says it does, without mentioning the limit. What does the code of conduct say about waiting?
- A Waiting is acceptable, because coverage changes are ordinarily made at renewal.
- B Waiting is acceptable, because the broker did not cause the figure to fall out of date.
- C Waiting breaches the duty to be candid as well as honest when advising the client. Correct
- D Waiting is acceptable if the broker documents the reasoning on the client file.
Paragraph 4 of the code requires a member to be both candid and honest when advising a client, so an assurance that the policy still fits, given while the broker knows the limit is short, withholds the one fact the client needed even though nothing false was said.

O. Reg. 991, s. 14, para. 4
Federal travel guidance names where a Canadian can buy trip interruption and travel health insurance, besides buying it directly from an insurance company. Which of the following are on that list? Select all that apply.
- A A credit card company Correct
- B A provincial or territorial health plan
- C A bank Correct
- D A travel agent Correct
- E A Canadian consular office abroad
- F A hospital at the destination
Federal travel guidance says trip interruption and travel health insurance can be bought directly from an insurance company or through a travel agent, an insurance broker, an employer's insurance provider, a credit card company or a bank, so a client who says she is already covered usually means an employer or credit card plan and the broker's job is to ask what that plan actually pays.
For out-of-country approvals under Ontario's health insurance regulation, what does the defined term emergency circumstances mean?
- A Any medical condition that the treating physician describes as urgent in writing
- B Any condition serious enough to need care in a hospital rather than in a clinic
- C Any condition for which the wait for treatment in Ontario is longer than three months
- D Immediate risk of death or of medically significant irreversible tissue damage Correct
Section 28.4 (1) defines emergency circumstances narrowly, as medical circumstances in which an insured person faces immediate risk of death or of medically significant irreversible tissue damage, so pain, urgency or a long Ontario wait list does not meet it and prior written approval is still needed.

R.R.O. 1990, Reg. 552, s. 28.4 (1)
A broker who declines to answer questions in an investigation by the Registered Insurance Brokers of Ontario (RIBO) commits a separate breach of the code of conduct, quite apart from whatever is being investigated. Is that statement true or false?
- A True Correct
- B False
Paragraph 14 of the code requires a member to cooperate in an investigation conducted by the Corporation, so refusing to answer or sitting on documents is misconduct in its own right, and section 25(4) of the Registered Insurance Brokers Act separately prohibits obstructing an investigator or concealing records.

O. Reg. 991, s. 14, para. 14
Under Regulation 991, what must appear on every cheque drawn on a brokerage trust account?
- A The words trust account and the name of the member the account is kept in, imprinted on the cheque. Correct
- B The signature of the principal broker and the brokerage's certificate of registration number in full.
- C The name of the insurer the payment relates to and the number of the policy.
- D A notation of the client's name written on the cheque at the time it is issued.
Section 16(9) requires all cheques drawn on a trust account to have the words trust account and the name of the member in whose name the account is kept imprinted on them, so the marking is printed on the stock rather than added by hand.

O. Reg. 991, s. 16(9)
The Ontario Health Insurance Plan (OHIP) funds two kinds of out-of-country health service. Which two are they?
- A Emergency health services for travellers, and services given prior approval before they are received Correct
- B Emergency health services for travellers, and elective surgery bought at a licensed hospital abroad
- C Routine care received while away, and emergency health services for travellers
- D Services a private travel insurer has declined, and services given prior approval before they are received
The province funds two kinds of out-of-country service, emergency health services for travellers and prior approved services, so a client's situation has to be placed in one of those two before anything else about the claim can be worked out.
A client is leaving for three weeks in Mexico next month and plans to take his Ontario health card. What should he check about the card before he goes?
- A That it carries a photograph, because a card without one is not honoured by a hospital outside Canada
- B That it was issued within the last three years, because a card older than that lapses on departure
- C That the printed address matches the address he gave the travel agent when he booked the trip
- D That it is still valid: not expired, correct personal information, and his current address on file Correct
The province tells a traveller to bring the health card but to make sure first that it is still valid, meaning it has not expired, it carries correct personal information and it shows the current address on file with ServiceOntario, so an address or name change is something to settle before departure rather than from abroad.
A commercial property named perils form insures property at the described location, and the definition of premises sets how far that reaches. Which description matches the definition?
- A The described buildings and the fixtures attached to them, and nothing beyond the walls
- B The area within the property lines only, excluding sidewalks, driveways and any vehicles
- C The area within the property lines, plus property in or on vehicles anywhere in the same municipality
- D The area inside the property lines and under adjoining sidewalks and driveways, plus nearby vehicles Correct
Premises means the entire area within the property lines and the areas under adjoining sidewalks and driveways at each described location, and it extends to property in or on vehicles within 100 metres of that location, so a yard loss and a loading area loss both sit inside the described premises.

Commercial Property Named Perils Form C100, clause 18 (g) (Definitions, Premises) Reference document, not law.
A co-insurance percentage appears on the declaration page of a commercial property form. What does the clause oblige the insured to do, and what follows if the insured does not?
- A Carry insurance equal to the full actual cash value, or the claim is refused outright
- B Carry insurance equal to replacement cost, or settle every loss on an actual cash value basis
- C Carry insurance equal to the stated percentage of each loss, or bear the shortfall personally
- D Carry the stated percentage of actual cash value, or recover only in that proportion Correct
The clause obliges the insured to carry insurance of at least the actual cash value multiplied by the co-insurance percentage on the declaration page, and where less is carried the recovery is the loss multiplied by insurance carried over insurance required.

Commercial Property Named Perils Form C100, clause 4 (Co-Insurance) Reference document, not law.
Where the person whose life is to be insured is under the age of sixteen, who may give the written consent the Insurance Act contemplates?
- A The child, provided the application is countersigned by the insurer's licensed agent.
- B No one, because the life of a person under sixteen may not be insured.
- C Both parents together, or a guardian appointed by a court order.
- D One of the child's parents, or a person standing in the role of parent to the child. Correct
Section 178(3) lets consent to insurance on the life of a person under sixteen be given by one of that person's parents or by someone standing in the role of parent, so the signature the Act looks for is the parent's rather than the child's.

Insurance Act, s. 178(3)
A manufacturer finds a defect in a product it has already shipped and pulls the stock back from retailers. Under a commercial general liability (CGL) policy, how is the cost of doing that treated?
- A Paid under the products-completed operations aggregate, up to that aggregate limit
- B Paid as a supplementary payment, because it reduces the insurer's eventual exposure
- C Paid under Coverage A once the product is shown to be dangerous when used
- D Excluded, because the policy takes out the cost of recalling the insured's product Correct
The recall exclusion removes damages claimed for the loss of use, withdrawal, recall, inspection, repair, replacement, removal or disposal of the insured's product or work because of a known or suspected defect in it, so the policy answers for the harm the product does and not for the cost of getting it back.

Commercial General Liability C574, Section I, Coverage A, exclusion 2.k Reference document, not law.
Baxter Design leases a floor of an office building. A space heater a staff member left running starts a fire that damages the floor Baxter leases and nothing beyond it, and the landlord sues Baxter. Which part of Baxter's commercial general liability (CGL) policy responds?
- A Coverage A, because the fire caused property damage to a third party
- B Coverage D, tenants' legal liability, because the damage is to rented premises Correct
- C Coverage C, because the loss arose out of Baxter's operations at the premises
- D No coverage, because a landlord's fire policy waives recovery against a tenant
Coverage A excludes property damage to property the insured rents or occupies, and Coverage D buys that back by applying only to property damage to premises of others rented to or occupied by the insured, so a tenant's liability for the landlord's building sits in Coverage D.

Commercial General Liability C574, Section I, Coverage D, clause 1.a Reference document, not law.
What does Coverage A of a commercial general liability (CGL) policy promise the insured?
- A To pay any claim brought against the business for bodily injury or property damage
- B To pay an injured person's medical expenses whether or not the business was at fault
- C To defend the business against any action, and to pay whatever a court eventually awards
- D To pay sums the insured is legally obligated to pay, and to defend actions seeking them Correct
Coverage A pays the sums the insured becomes legally obligated to pay as compensatory damages because of bodily injury or property damage the insurance applies to, and the insurer takes both the right and the duty to defend an action seeking those damages, so legal liability rather than the arrival of a claim is what triggers it.

Commercial General Liability C574, Section I, Coverage A, clause 1.a Reference document, not law.
A surety bond names three parties. Which set is correct?
- A The insured, the insurer and the broker who arranged the bond
- B The contractor, the project owner and the owner's construction lender
- C The principal, the surety and the obligee Correct
- D The applicant, the underwriting company and its reinsurer
A bond binds the principal, who owes the obligation, and the surety, who guarantees it, to the obligee for whose benefit the guarantee is given, so suretyship is a three party arrangement where insurance is a contract between two.

Bid bond, form PWGSC-TPSGC 504, Bond recital Reference document, not law.
Under a commercial general liability (CGL) policy, three neighbours are made ill by one continuing emission from an insured plant. Against the each occurrence limit, how many occurrences is that?
- A Three occurrences, one for each of the persons who suffered bodily injury from the emission
- B Three occurrences, because each claimant's injury began on a different date from the others
- C One occurrence for each month over which the emission from the plant continued to run
- D One occurrence, because repeated exposure to one set of conditions is one accident Correct
The each occurrence limit is the most payable for all bodily injury and property damage arising out of any one occurrence, and the definition of occurrence brings repeated or continuous exposure to one set of substantially similar harmful conditions inside a single accident, so one continuing emission is one occurrence however many people it makes ill.

Commercial General Liability C574, Section V, definition 21 Reference document, not law.
A commercial general liability (CGL) insurer has paid settlements that use up the applicable limit of insurance while an action against the insured is still running. Its right and duty to defend end at that point. Is that statement true or false?
- A True Correct
- B False
The insuring agreement says the right and duty to defend end when the insurer has used up the applicable limit of insurance in the payment of judgments or settlements, so exhausting the limit ends the defence even while the action against the insured is still running.

Commercial General Liability C574, Section I, Coverage A, clause 1.a.2) Reference document, not law.
A bid bond obliges a successful bidder to furnish further security before the work starts. Which instruments does it name?
- A A maintenance bond and a warranty bond, each for a stated share of the contract price
- B A second bid bond and a performance bond, each satisfactory to the obligee
- C A performance bond and a labour and material payment bond, or other accepted security Correct
- D A licence bond and a customs bond, each issued by the same surety company
The bid bond requires the successful bidder to furnish a performance bond and a labour and material payment bond, each written for a stated proportion of the contract price and satisfactory to the obligee, unless the obligee accepts other security instead, so the sequence in contract surety runs bid, then performance, then payment.

Bid bond, form PWGSC-TPSGC 504, Conditions of the obligation, paragraph (a) Reference document, not law.
A courier firm's driver rear-ends a car while making a delivery in the company van, and the injured driver sues the firm. The firm holds a commercial general liability (CGL) policy and an automobile policy. Which one responds?
- A The liability policy, because the firm's own negligence in hiring the driver is alleged
- B Both policies, sharing by limits, because the claim arises out of the firm's operations
- C The automobile policy, because the liability policy excludes automobiles the insured owns Correct
- D The liability policy, because making deliveries is part of the insured business described
Coverage A excludes bodily injury or property damage arising out of the ownership, maintenance, use or entrustment of any automobile owned by, operated by, rented to or loaned to an insured, and the exclusion holds even where the claim is pleaded as negligent hiring or supervision, so the automobile policy is the one that answers.

Commercial General Liability C574, Section I, Coverage A, exclusion 2.f Reference document, not law.
What triggers a claim under a gross earnings business interruption form?
- A A drop in the insured's turnover measured against the same period a year earlier
- B A necessary interruption caused by insured damage at the described premises Correct
- C Any event that stops the insured trading for longer than a stated waiting period
- D The failure of a key supplier to deliver the materials the insured business depends on
The indemnity agreement responds to loss directly resulting from a necessary interruption of business caused by destruction or damage by an insured peril to buildings, structures, machinery, equipment or stock at the described premises, so without insured physical damage there is no business interruption claim.

Business Interruption Insurance Gross Earnings Endorsement Form C715, clause 1 (Indemnity Agreement) Reference document, not law.
A client's tenants moved out on March 1 with no intention of returning and nobody new has moved in. The client knows the house is empty and no vacancy permit is shown on the coverage summary page. A fire damages the house on March 20, and a second fire damages it on April 20. Under a typical habitational wording, how do the two losses fare?
- A Both losses are excluded, because coverage ended the day the tenants left
- B The March loss is insured and the April loss is not, because vacancy passed 30 days Correct
- C Both are insured, because fire is insured whatever the occupancy of the dwelling
- D The March loss is excluded and the April loss is insured, once the client tells the insurer
Three things have to line up for the exclusion to bite: vacancy as the policy defines it, the insured's knowledge of it, and more than 30 consecutive days, and the clause removes only loss occurring after that period.
Under a typical habitational wording, what triggers the vacancy exclusion on the property side of the policy?
- A Any period at all during which nobody sleeps at the dwelling
- B The dwelling standing unoccupied for more than 12 consecutive months
- C Loss after the dwelling has knowingly been vacant over 30 consecutive days Correct
- D The insured failing to tell the broker that the dwelling will stand empty
The clause is built from a defined term, a state of knowledge and a day count, so all three have to be present before the exclusion removes a loss.
A client installs a wood burning stove in her living room in October. Under a typical habitational wording, what does the policy ask her to do?
- A Tell the broker, because installing a wood burning appliance must be reported Correct
- B Nothing at all, provided the stove is certified and professionally installed
- C Wait until renewal and mention it on the renewal questionnaire then
- D Nothing, because heating equipment forms part of the dwelling and is insured automatically
Installation of a wood burning appliance sits on the list of changes the wording tells the client to report, which makes it a mid-term broker conversation rather than a renewal item.
A client insured for less than the co-insurance clause requires suffers a total loss. What effect does the clause have on that claim?
- A It cuts the payment below the amount of insurance in proportion to the shortfall
- B None, because on a total loss the indemnity is capped at the amount of insurance Correct
- C It voids the policy, because the client has breached a condition of the contract
- D It doubles the deductible that applies to the claim
Co-insurance is a partial loss mechanic, because a total loss is already capped at the amount of insurance, which is why the advice is to insure to the full value or the full replacement cost.
Under section 145 of the Insurance Act, how may a property contract be renewed?
- A Only where the insured signs a fresh written application
- B By delivery of a renewal receipt identifying the policy by number or date Correct
- C Only where the insurer issues a completely new policy document
- D By the broker recording the renewal in the brokerage's own internal records
The Act allows renewal by a receipt that identifies the policy, so a fresh policy document is not required and the identification can be by number, by date or in some other way.

Insurance Act, s. 145
A garage owner insures a courtesy car with Comprehensive coverage. A mechanic whose duties include driving and servicing that car steals it on a Sunday, well outside working hours. Is the loss covered?
- A Yes, because the theft happened outside the mechanic's working hours.
- B No, because the exclusion for theft by an employee whose duties include driving or repairing the automobile applies at any time. Correct
- C Yes, because the employee limb of the exclusion catches only a person who lives in the same dwelling as the insured garage owner.
- D No, because the theft was not reported to the police within 24 hours of being discovered.
The subsection takes out theft by an employee whose duties include driving, maintaining or repairing the automobile, and it states that this applies at any time and not simply during working hours, so the Sunday timing does not rescue the claim.

OAP 1, Section 7.2.3
How is the degree of fault determined where an incident is not described in any of the Fault Determination Rules?
- A The driver of each automobile is deemed to be 50 per cent at fault for the incident.
- B The claim is refused, because the rules govern every incident that they apply to.
- C The degree of fault is determined in accordance with the ordinary rules of law. Correct
- D The insurer of the automobile carrying the higher limit bears the whole loss.
The Fault Determination Rules do not try to describe every collision, so where an incident falls outside them the degree of fault of the insured is worked out under the ordinary rules of law, and the same answer applies where there is not enough information about the incident.

O. Reg. 668, s. 5 (1)
Which claims does Liability Coverage under the Ontario Automobile Policy OAP 1 refuse?
- A Claims for bodily injury suffered by a passenger riding in the described automobile
- B Claims for damage to property carried in the automobile, or to other property in the insured's care, custody or control Correct
- C Claims for damage to a warehouse wall that the insured struck while parking the automobile outside a customer's premises
- D Claims brought by a pedestrian who was struck by the described automobile in a crosswalk
The other limitations in Liability Coverage exclude claims for damage to property carried in or upon the automobile and to other property owned or rented by, or in the care, custody or control of, the insured or other insured persons, which is the gap OPCF 27 and OPCF 27B are sold to fill.

OAP 1, Section 3.5.1
Under the statutory conditions for automobile insurance, when does the salvage vest in the insurer?
- A Where the insurer exercises its option to replace the automobile or pays its actual cash value Correct
- B As soon as the insured delivers the automobile to the insurer or to its appraiser
- C Where the cost of repair exceeds seventy per cent of the automobile's value
- D Where the insured signs a proof of loss describing the automobile as a total loss
The salvage passes to the insurer at the point the insurer either replaces the automobile or pays its actual cash value, which is the second half of the same condition that prohibits abandonment unless the insurer consents.

O. Reg. 777/93, Schedule, statutory condition 6 (7)
How does OPCF 20 change the loss of use protection a client already carries under the Ontario Automobile Policy OAP 1?
- A It leaves subsection 7.4.4 in place and adds a separate daily and per occurrence limit that answers a theft loss only.
- B It replaces the loss of use due to theft coverage and answers loss or damage from any peril the client is insured for. Correct
- C It narrows the protection to theft, so a collision no longer produces a transportation claim.
- D It doubles the amount payable under subsection 7.4.4 without altering the perils that trigger it.
OAP 1 subsection 7.4.4 pays for substitute transportation only after a theft, while OPCF 20 replaces that coverage and answers loss or damage caused by any peril the client is insured for, so the reach of the protection widens well beyond theft.

OPCF 20, Section 1
Which Ontario Policy Change Form pays the reasonable expenses of renting a similar substitute automobile, including taxicab or public transportation costs, when a loss from an insured peril leaves the client without transportation?
- A OPCF 43, Removing Depreciation Deduction, which changes how a settlement is calculated
- B OPCF 19A, Agreed Value of Automobiles, which fixes the value of the listed automobile
- C OPCF 27, Liability for Damage to Non-Owned Automobiles, which responds to a rental car's damage
- D OPCF 20, Coverage for Transportation Replacement, which reimburses substitute transportation Correct
OPCF 20 exists to pay for other means of transportation when loss or damage from a peril the client is insured for takes the automobile off the road, and it reimburses the reasonable expenses of a rental as well as taxicab or public transportation costs.

OPCF 20, Section 1
A brokerage wants a larger operating line of credit. Its bank agrees, on condition that the brokerage pledge its premium receivables, the money owed by clients for policies placed with insurers, as security for the loan. The principal broker asks whether the brokerage can sign. What is the answer under the Registered Insurance Brokers Act?
- A No, unless the Manager approves the pledge in writing before the loan is advanced.
- B Yes, provided the amount pledged never exceeds the balance held in the brokerage's trust account.
- C No. Those funds are deemed trust funds, and a member cannot assign, pledge or in any way charge them. Correct
- D Yes, provided each affected insurer gives the brokerage written consent to the pledge.
Section 32 of the Registered Insurance Brokers Act deems funds a member receives or has receivable on behalf of insurers or the public to be trust funds and prohibits a member from assigning, pledging, hypothecating, mortgaging or otherwise charging them, so the security the bank wants cannot be given.

RIB Act, s. 32(1), (2)
A contractor fits a bathroom drain badly, the joint fails, and water soaks the ceiling below. Under a typical habitational wording on an all risks form, what does the faulty workmanship exclusion take out of the claim?
- A The cost of making good the faulty work itself Correct
- B The whole claim, because a contractor was at fault
- C Nothing, because the exclusion catches faulty design only
- D The resulting damage to the ceiling, but not the cost of the defective work
The exclusion is written as the cost of making good faulty design, material or workmanship, so it removes the price of putting the defective work right and leaves the damage that flowed from it to be dealt with on the rest of the form.
Under the Registered Insurance Brokers Act, what must a person hold before acting as an insurance broker in Ontario?
- A A licence issued by the Financial Services Regulatory Authority of Ontario (FSRA).
- B Registration as an insurance broker under the Registered Insurance Brokers Act. Correct
- C Employment with a registered brokerage, working under the principal broker's registration.
- D Written authority from an insurer allowing the person to bind coverage.
Section 2 of the Registered Insurance Brokers Act bars any person from acting as an insurance broker unless that person is personally registered under the Act, so working at a registered firm or belonging to an industry association does not stand in for the individual's own registration.

RIB Act, s. 2(1)
Under a typical habitational wording, who counts as a civil authority for the purposes of the evacuation coverage?
- A A person acting under federal, provincial or territorial authority in an emergency Correct
- B Any organisation with the legal power to order people out of a building
- C The condominium corporation or the property manager responsible for the building
- D A private security firm engaged by the municipality to close off a street
The wording defines civil authority as any person acting under the authority of the federal government or a provincial or territorial government with respect to the protection of persons and property in an emergency, so the power has to come from one of those governments.
Under a typical habitational wording, what does a comprehensive or all risks form insure?
- A Every loss the property can suffer, with no exceptions
- B The perils listed in the form, each as described and limited
- C All risks of direct physical loss or damage from any external cause, subject to the exclusions Correct
- D All risks of loss to the property, whether the cause is external to it or is inherent in it
An all risks form insures against all risks of direct physical loss or damage from any external cause subject to the policy's exclusions, so the argument shifts from proving a peril to reading what the form takes out.
Under the Insurance Act, where is the list of unfair or deceptive acts and practices actually set out?
- A In Part XVIII of the Insurance Act, which names each prohibited act in its own subsections.
- B In the Authority rules, because the Act defines the term by what those rules prescribe. Correct
- C In Regulation 7/00, which is still the operative list of prohibited practices in Ontario.
- D In the by-laws of the Registered Insurance Brokers of Ontario (RIBO), for everyone RIBO registers.
Section 438 defines an unfair or deceptive act or practice as any activity or failure to act that the Authority rules prescribe, so the Act supplies the definition and the rule made by the Financial Services Regulatory Authority of Ontario (FSRA) supplies the list of conduct itself.

Insurance Act, s. 438
Who may use the designation R.I.B. (Ont.)?
- A Any person licensed as an insurance agent under the Insurance Act.
- B Only the holder of a certificate as a registered insurance broker under the Registered Insurance Brokers Act. Correct
- C Any employee of a registered brokerage who has passed an accredited insurance course.
- D Any holder of the Chartered Insurance Professional designation from the Insurance Institute of Canada.
Subsection 3(2) of the Registered Insurance Brokers Act requires the user of the title registered insurance broker or the designations R.I.B. (Ont.) and C.A.I. (Ont.) to be the holder of a certificate under the Act, because the restriction attaches to the certificate, completing a course or holding another licence carries no right to use them.

RIB Act, s. 3(2)
For the purposes of the unfair or deceptive acts and practices Part of the Insurance Act, which of the following are included in the definition of a person? Select all that apply.
- A A partnership Correct
- B A parcel of land held for commercial use
- C A corporation Correct
- D A syndicate Correct
- E A motor vehicle registered in Ontario
Section 438 defines person to take in individuals, corporations, associations, partnerships, organizations, reciprocals, Lloyd's members, fraternal and mutual benefit societies and syndicates, which is why the prohibition reaches business structures and not only individuals.

Insurance Act, s. 438
Hana is stopped in slow traffic in the right lane when the car behind her, travelling in the same direction and the same lane, strikes her from the rear. The road was icy that morning. How is fault determined under the Fault Determination Rules?
- A Hana and the other driver are each 50 per cent at fault because of the icy road.
- B Fault is determined under the ordinary rules of law, because road conditions were a factor.
- C Hana is not at fault and the other driver is 100 per cent at fault. Correct
- D Hana is 25 per cent at fault because she was stopped in a live traffic lane.
The Fault Determination Rules deal directly with a rear-end collision between two automobiles travelling in the same direction and lane, and road conditions are not considered, so the stopped driver is not at fault and the following driver carries 100 per cent.

R.R.O. 1990, Reg. 668, s. 6 (2)
The prohibition on unfair or deceptive acts and practices in the Insurance Act applies only to licensed insurers, so a brokerage or an automobile repair shop falls outside it. Is that statement true or false?
- A True
- B False Correct
Section 439 states that no person shall engage in any unfair or deceptive act or practice, and the Part's definition of person is wide, so a brokerage, an adjuster and a repair shop are all inside the prohibition alongside insurers.

Insurance Act, s. 439
Under a typical habitational wording, which event falls inside the defined term water escape?
- A Sewage backing up through a basement floor drain
- B A river overflowing its banks and entering the basement
- C Water seeping through a foundation wall after heavy rain
- D An accidental overflow of water from a household appliance Correct
Water escape means the accidental discharge or overflow of water or steam from something it was meant to stay inside, such as a plumbing, heating, sprinkler or air conditioning system, a household appliance, an aquarium, a waterbed, a pool or hot tub, or a watermain.
A broker is renewing a client's automobile policy with an insurer that belongs to a group of three affiliated companies. The renewal offer from the incumbent company is $2,240. A sister company in the same group would write the same risk at $1,890 through the same brokerage. What does FSRA Rule 2020-001 require the broker to do?
- A Present the incumbent renewal, because the client chose that company at inception.
- B Present the incumbent renewal, because the affiliate duty applies to new business only.
- C Survey every insurer the brokerage represents and present the cheapest overall.
- D Offer the lowest rate available among that insurer and its affiliated insurers. Correct
Section 10(1) makes it an unfair or deceptive act or practice for a broker providing a quote or renewal from an insurer not to offer the lowest rate available among that insurer and its affiliated insurers, and the subsection names renewals as well as quotes.

FSRA Rule 2020-001, s. 10(1)
Under a typical habitational wording, what does the defined term ground water describe?
- A Any water that reaches a basement floor, however it got there
- B Water standing on ground that does not normally hold any water after a heavy rainfall
- C Water in the soil below the surface, including wells and percolating water Correct
- D Water that has backed up through a weeping tile or a sump
Ground water is defined by where the water already is, namely in the soil below the surface, which is why the wording handles it separately from both flood and sewer backup and why a water endorsement has to name it on its own.
Under a typical habitational wording, an electric bicycle with pedals stays inside Coverage C only within stated limits. What are those limits?
- A Not more than 250 watts and not exceeding 25 km per hour
- B Not more than 750 watts and not exceeding 32 km per hour
- C Not more than 500 watts and not exceeding 32 km per hour Correct
- D Not more than 500 watts, with no speed limit stated
The carve-out to the motorized vehicle exclusion sets two thresholds together, power and speed, so a bicycle that breaches either one falls back out of Coverage C and into the exclusion.
Under a typical habitational wording, every form in the endorsements part of the policy adds coverage the base policy does not carry. Is that statement correct?
- A True
- B False Correct
The endorsements part says the forms in it may extend or limit coverage, so the same list holds a water endorsement that broadens cover and a vacancy permit or wood stove warranty that cuts it back.
Where does part of the money in the Motor Vehicle Accident Claims Fund come from?
- A A share of every automobile premium collected in Ontario, remitted to the Fund by the brokers who collect it.
- B General tax revenue voted to the Fund by the Legislature each year.
- C A prescribed fee paid to the Fund by every person on the issue or renewal of a driver's licence. Correct
- D Fines collected for offences committed under the Compulsory Automobile Insurance Act.
Section 2(2) requires a fee prescribed by the Lieutenant Governor in Council to be paid to the Fund by the person to whom a driver's licence or renewal is issued, and section 2(1.2) also records amounts assessed against insurers, so drivers help fund it directly.

Motor Vehicle Accident Claims Act, s. 2(2)
Under By-Law No. 3, what form must a principal broker's supervision arrangements take?
- A An understood practice consistently followed by everyone in the office.
- B Procedures and a written Plan of Supervision that are established and followed. Correct
- C A quarterly file review signed by each supervised licensee.
- D An annual attestation filed with the firm's errors and omissions (E&O) insurer.
Section 6.1(d)(viii) makes it part of the principal broker's direction and supervision duties that procedures and a written Plan of Supervision are established and followed to ensure compliance, so a well-run but unwritten practice does not satisfy the by-law.

By-Law No. 3, s. 6.1(d)(viii)
Under a typical habitational wording, the policy is assembled from separate parts. Which statement describes the part that holds the policy conditions, the statutory conditions and the additional conditions?
- A It is a separate part whose conditions apply to every section of the policy Correct
- B It is printed inside the property part and governs property claims only
- C It is printed inside the liability part and governs liability claims only
- D It is attached to each endorsement and governs the endorsements only
A habitational policy is built from parts that each do one job, and the conditions part is written to apply to all sections, so a condition on notice or on misrepresentation governs a liability claim as much as a property claim.
A kitchen fire makes a client's house unfit to live in for two months. The family rents an apartment, and their grocery and utility spending at the house stops while they are out. Under a typical habitational wording, what does the additional living expenses coverage pay?
- A The whole of the family's living costs across the two months
- B The necessary increase in living expenses, moving expenses included Correct
- C The apartment rent alone, with no other expense taken into account
- D The rental value the client could have obtained by letting the damaged house
The coverage responds where an insured peril makes the dwelling unfit for occupancy or forces the household out during repairs, and it pays the necessary increase in living expenses, so costs that stop at home are set against the new costs.
Two defendants are found at fault for the same loss, one at 80 per cent and one at 20 per cent. Under the Negligence Act, what may the injured person recover from the defendant found 20 per cent at fault?
- A The whole of the damages, because the defendants are jointly and severally liable to the person suffering the loss. Correct
- B Twenty per cent of the damages, matching that defendant's share of the fault.
- C Nothing, until the injured person has exhausted recovery against the defendant found 80 per cent at fault.
- D Half of the damages, because liability is divided equally between defendants at trial.
Section 1 makes two or more persons found at fault jointly and severally liable to the person suffering the loss, and confines the split by degree of fault to contribution and indemnity between the wrongdoers themselves, which is why a liability policy can be asked for the whole judgment on a small share of fault.

Negligence Act, s. 1
A contractor's blowtorch starts a fire that damages your client's insured home. The insurer pays the client's claim under the property contract. Under section 152 of the Insurance Act, what may the insurer do next?
- A It is subrogated to the client's rights of recovery against the contractor and may bring an action in the client's name Correct
- B It must wait for the client to sue the contractor first, then claim a share of whatever the client recovers
- C It has no rights against the contractor, because the client has already been paid under the contract
- D It may pursue the contractor only if the client signs a formal assignment of the claim after payment
Section 152 (1) subrogates the insurer to all rights of recovery of the insured against any person upon making a payment or assuming liability for one, and expressly lets the insurer sue in the name of the insured, so no separate step by the client is needed.

Insurance Act, s. 152 (1)
Two or more items are damaged in one occurrence, or several insured perils act together to cause the loss. Under a typical habitational wording, how is the deductible applied?
- A One deductible applies, the largest of all those that could apply Correct
- B Each of the applicable deductibles is applied in turn against the loss amount
- C The deductibles are added together and taken off the loss
- D The smallest applicable deductible is the one used
The wording states that only one deductible will be used and that it will be the largest single deductible of all that apply, so a client with a higher water deductible meets that figure once and not twice.
What standard does the Occupiers' Liability Act set for an occupier's duty to people entering the premises?
- A To keep the premises safe for anyone who enters, whatever care that would take in the circumstances.
- B To meet the standard of care the common law owed to an invitee, which the Act expressly preserves for anyone who is lawfully on the premises.
- C To warn entrants of every hazard the occupier knows about, whether or not the hazard is obvious to them.
- D To take such care as in all the circumstances is reasonable to see that persons entering, and the property they bring, are reasonably safe. Correct
Section 3(1) sets the duty as taking such care as in all the circumstances of the case is reasonable to see that persons entering, and the property they bring, are reasonably safe while on the premises, and section 2 replaces the old common law categories of visitor.

Occupiers' Liability Act, s. 3(1)
A client rents a room in her house to a lodger who is not a relative. Under a typical habitational wording, how does Coverage C treat the lodger's own belongings?
- A They are insured up to the full amount of insurance on personal property
- B They are insured, but only against the specified perils named in the form
- C They are not insured, because Coverage C excludes an unrelated roomer's property Correct
- D They are insured while the lodger lives in the dwelling and for thirty days after leaving
Coverage C brings in property of others generally but then removes property of roomers or boarders who are not related to the insured, so the lodger needs a tenant policy of their own.
Under the Occupiers' Liability Act, who is an occupier of premises?
- A The registered owner of the land, and no one else, since responsibility for premises follows title on the parcel register.
- B The person who carries on the principal business conducted at the premises, whether or not that person has any responsibility for the condition of the building or control over who may enter.
- C Whoever is named as the insured on the property policy covering the premises, together with anyone added to that policy by endorsement as an additional insured.
- D The person in physical possession, or a person with responsibility for and control over the condition of the premises, the activities there, or who may enter, and there may be more than one. Correct
Section 1 defines occupier to include a person in physical possession and a person with responsibility for and control over the condition of the premises, the activities carried on there, or the persons allowed to enter, and says so despite there being more than one occupier of the same premises.

Occupiers' Liability Act, s. 1
Under Regulation 991, what must a sole proprietorship, partnership or corporation do in order to hold a certificate of registration as an insurance broker?
- A Designate an individual who is an insurance broker to be the principal broker of the business. Correct
- B Appoint a director who has completed a recognized risk management designation or equivalent diploma.
- C Nominate one employee to hold the certificate of registration on the firm's behalf.
- D Retain an external compliance consultant to review its client files each year.
Section 7.2(1) requires a firm that holds or wishes to hold a certificate of registration to designate an individual who is an insurance broker as its principal broker, so a firm cannot be registered without one in place.

O. Reg. 991, s. 7.2(1)
By-Law No. 3 sets the classes of firm registration. What are they?
- A Level 1, Level 2 and Level 3 firm licensee
- B Sole proprietorship, partnership and corporation licensee
- C Brokerage, managing general agency and consultant firm licensee
- D Active firm licensee, non-active firm licensee and consultant firm licensee Correct
Section 4.1 provides that there shall be three classes of firm registration, namely active firm licensee, non-active firm licensee and consultant firm licensee, so the levels used for individuals are a separate scheme.

By-Law No. 3, s. 4.1
A client bought her house for $420,000 in a soft market. A contractor estimates $610,000 to rebuild it from the ground up, and the municipal assessment is $480,000. She wants the building insured for what she paid. What should the broker advise?
- A Insure for $420,000, because that is what the property cost her
- B Insure for $480,000, because the municipal assessment is the independent figure
- C Insure for the rebuilding cost, since that is what a rebuild would cost Correct
- D Insure for the average of the three figures, because no single number is reliable
The building amount has to match the cost of putting the same house back up from scratch, so it can sit well away from what the market pays for the property and from the figure a tax roll carries.
A client is upgrading from a named perils form to an all risks form and asks whether that buys protection for the drain in his basement backing up. Under a typical habitational wording, what should the broker tell him?
- A No, because the all risks form excludes backup from a sewer, drain, sump or weeping tile Correct
- B Yes, because an all risks form covers everything the named perils form left out
- C Yes, because a floor drain forms part of the plumbing system under an all risks form
- D Yes, provided the backup is sudden and accidental rather than gradual
Backup or escape from a sewer, drain, sump, septic system, weeping tile, eavestrough or downspout is excluded on the all risks form just as it is on the named perils form, so only the sewer back-up endorsement buys that protection.
Under a typical habitational wording on an all risks form, how is damage caused by birds, vermin, rodents, raccoons, skunks, moles, mice or insects treated?
- A It is insured, because the form covers all risks of physical damage
- B It is excluded, except for resulting damage to building glass Correct
- C It is excluded, with a narrow exception for damage to electrical wiring
- D It is insured, but capped by a special limit on that class of property
The wording excludes damage by these animals and insects and then carves back only resulting damage to building glass, so an infestation is the homeowner's problem while a broken window that follows may not be.
A client's dog chews through the hardwood flooring in the hallway. Under a typical habitational wording on an all risks form, that damage is insured because the form covers all risks. Is that statement correct?
- A True
- B False Correct
The form excludes damage caused by a domesticated animal or bird the insured owns or has in their care, so the exclusion reaches a dog being looked after for a friend just as it reaches the family pet.
A principal broker appoints a deputy principal broker and prescribes to her in writing the whole of the firm's trust account oversight. A year later the trust reconciliations are found to be a shambles. The principal broker says the duty was handed over in writing and is no longer his. What does By-Law No. 3 provide?
- A Responsibility moved to the deputy, because the delegation was made in writing as the by-law requires.
- B The principal broker continues to be responsible for compliance despite the appointment and delegation. Correct
- C Responsibility is shared equally, because the by-law makes delegated duties joint.
- D Responsibility moved to the deputy, provided the Registered Insurance Brokers of Ontario (RIBO) was told of the appointment.
Section 6.1(i) states that despite any appointment and delegation of duties, a principal broker continues to be subject to and remains responsible for compliance with the responsibilities in the applicable laws, so delegation adds a person rather than moving the accountability.

By-Law No. 3, s. 6.1(i)
Under a typical habitational wording on an all risks form, what is left insured once the terrorism exclusion has been applied?
- A Nothing, because the exclusion removes the whole of the loss
- B Any share of the loss the insured can attribute to an insured peril
- C Loss caused by a government decision taken to respond to terrorism
- D Ensuing loss or damage that results directly from fire or explosion Correct
The exclusion closes with a carve-back saying the insured is still covered for ensuing loss or damage resulting directly from fire or explosion, so that is the one slice of the claim the clause leaves alive.
A client's adult son, who lives with her, reverses the lawn tractor into her parked car. Under a typical habitational wording, does the liability part answer her loss?
- A Yes, because the son is a separate insured person under the same policy
- B No, because damage to property owned by anyone in the household is excluded Correct
- C Yes, because a lawn tractor is one of the machines the liability part names
- D No, because a lawn tractor is not among the machines the policy names
Liability insurance answers to third parties, so the wording excludes damage to property owned by the insured or by any person residing in the household other than a residence employee, and the property side of the policy is what deals with the insured's own things.
A condominium unit owner is protected by two separate policies. Which items does the corporation's policy leave to the unit owner's own policy?
- A The common property, including hallways, stairs and the roof
- B The buildings shown on the condominium plan
- C The owner's contents, unit improvements, and their liability Correct
- D The corporation's own furniture and equipment
The two policy structure is what makes a unit owner policy necessary rather than optional, because the corporation's policy stops short of the owner's contents, the improvements made to the unit and the owner's personal liability.
Under a typical habitational wording, what does replacement cost mean?
- A The price the insured originally paid for the item when it was new
- B The cost of a brand new item of the best quality available today
- C The cost at the time of loss of repair or replacement, whichever is the lesser Correct
- D Whatever it costs to put the insured back where they were, with no upper limit
Two limits live inside the one definition: the insurer pays the lesser of repair and replacement with property of similar kind and quality, and it will not pay more than the applicable amount of insurance.
A client is sued for an amount that would take up her whole Coverage E limit, and the insurer defends the action. Under a typical habitational wording, how are the defence costs treated?
- A They are paid on top of the limit rather than out of it Correct
- B They come out of the limit, so less is left to pay damages with
- C They are shared equally between the insurer and the insured
- D They are paid only once the insured has paid a liability deductible
The supplementary payments list opens by saying the insurer will pay these amounts in addition to the limit of insurance under Coverage E, so defence spending does not eat into the money available for damages.
A tenant asks why she should buy tenant insurance when she owns no building. What are the two things it is bought for?
- A Her possessions and the landlord's building itself
- B Her possessions and her personal liability, which the lease requires Correct
- C Her possessions and the rent she still owes while the unit is repaired
- D Her personal liability and the landlord's own loss of rent
Tenant insurance covers possessions in the apartment and while the tenant is away, and it carries personal liability because a tenant can be answerable for damage to the building and for harm to people who live in or visit it.
Under the Highway Traffic Act, when is the owner of a motor vehicle not liable for loss caused by negligence in its operation on a highway?
- A Where the owner was not present in the vehicle at the time of the collision on the highway.
- B Where the vehicle was in the possession of someone other than the owner or the owner's chauffeur without the owner's consent. Correct
- C Where the driver was convicted of an offence under the Highway Traffic Act arising out of the same collision on the highway.
- D Where the driver held a valid licence and the owner had no reason to doubt their ability to drive safely.
Section 192(2) makes the owner liable for loss caused by negligence in the operation of the vehicle on a highway unless the vehicle was, without the owner's consent, in the possession of a person other than the owner or the owner's chauffeur, so consent to possession is the hinge and it is not the same as consent to how the vehicle was driven.

Highway Traffic Act, s. 192(2)
A tractor trailer is owned by a leasing company and leased to a haulage firm, whose employee drives it. The trailer runs under the operating authority of a separate carrier, which dispatches the load. The load shifts because of poor securement and injures a motorist. Under the Highway Traffic Act, whose liability does the Act add on top of the owner's and the lessee's?
- A The operator of the commercial motor vehicle. Correct
- B The consignor who packed the load.
- C The repair facility that last inspected the trailer.
- D The insurer that issued the fleet policy.
Section 192(5) provides that in addition to any liability of an owner or lessee, the operator of a commercial motor vehicle is liable for loss caused by negligence in its operation on a highway, and section 192(6) then makes driver, owner, lessee and operator jointly and severally liable.

Highway Traffic Act, s. 192(5)
Under the Insurance Act, when is insurable interest tested for a contract insuring a life, and what happens if it is absent?
- A At the time of the loss, and the contract is voidable at the insurer's option.
- B At the time the claim is made, and the contract is void from that date forward.
- C At the time the first premium is paid, and the contract is voidable at the insured's option.
- D At the time the contract would otherwise take effect, and the contract is void. Correct
Section 178(1) provides that where at the time a contract would otherwise take effect the insured has no insurable interest, the contract is void, which is a stronger result than voidable because there is nothing for the insurer to elect.

Insurance Act, s. 178(1)
To continue to be recognized as an Ontario resident for Ontario Health Insurance Plan (OHIP) purposes, how long must a person be physically present in Ontario in any given 12-month period?
- A At least 183 days
- B At least six consecutive months
- C At least 212 days
- D At least 153 days Correct
Paragraph 3 of subsection 1.5 (1) requires the person to be physically present in Ontario for at least 153 days in any given 12-month period, subject to the absences sections 1.6 to 1.14 allow, so a client planning a long trip has to count days against 153 rather than against half a year.

R.R.O. 1990, Reg. 552, s. 1.5 (1)
Under the Registered Insurance Brokers Act, a person registered under the Travel Industry Act, 2002 may act without being a registered insurance broker in respect of which insurance?
- A Travel accident and sickness, baggage or trip cancellation insurance Correct
- B Any insurance the person places for a client who has booked travel through them
- C Travel health insurance only, and no other travel-related product
- D Travel accident and sickness insurance plus automobile insurance on a rental vehicle
Section 2 of the Registered Insurance Brokers Act lifts the broker registration requirement for a Travel Industry Act registrant only in respect of travel accident and sickness, baggage and trip cancellation insurance, so anyone placing a class outside that short list is acting as an insurance broker and must be registered.

RIB Act, s. 2(2)(e)
A broad form commercial property policy and a named perils commercial property policy are compared side by side. Which statement most accurately describes where the burden sits when cover is disputed?
- A On a broad form the insured must still bring the loss inside a listed peril
- B On a named perils form the insurer must point to an exclusion to decline
- C On both forms the insurer must point to an exclusion in order to decline
- D On a broad form the insurer must point to an exclusion in order to decline Correct
A broad form starts from every risk of direct physical loss or damage and takes cover away only by exclusion, so the insurer has to bring the loss inside one, while a named perils form responds only where the insured brings the loss inside the perils it lists.

Commercial Property Broad Form C518, clause 5 (Insured Perils) Reference document, not law.
A contractor asks whether the firm's automobiles can be written as a fleet. The firm runs six automobiles under one company name: five cargo vans used to carry tools and materials to job sites, and one car the owner drives for personal use. Does this group meet the definition of a fleet in Regulation 664?
- A No, because a fleet needs at least ten automobiles under common ownership or management.
- B Yes, because the group holds at least five automobiles, at least five of them are commercial vehicles, and they are under common ownership. Correct
- C No, because every automobile in the group has to be a commercial vehicle or a public vehicle.
- D Yes, because any group of automobiles under common ownership counts as a fleet once one of them is a commercial vehicle.
Regulation 664 sets the floor at five automobiles with at least five of them commercial vehicles, public vehicles or vehicles used for business purposes, so the five cargo vans carry the group over the line even though the sixth automobile is personal.

R.R.O. 1990, Reg. 664, s. 1
Under a typical commercial property named perils form, the insuring agreement caps what the insurer will pay for a direct loss. Which measure does it use?
- A The amount of insurance shown on the declaration page for the property lost or damaged
- B The cost of replacing the property with new property of like kind and quality
- C The actual cash value of the property, whatever the amount of insurance shown for it
- D The least of actual cash value, the insured's interest and the amount of insurance Correct
The insuring agreement pays the direct loss up to whichever is least of the actual cash value at the time of loss, the insured's interest in the property, and the amount of insurance shown for that property, so the declaration page figure is a ceiling rather than the measure of the loss.

Commercial Property Named Perils Form C100, clause 1 (Insuring Agreement) Reference document, not law.
A retailer keeps a cash float and a book of prepaid transit tickets on the premises. Under a commercial property named perils form, where does that property sit?
- A Inside the stock amount, because tickets and cash are merchandise held for sale
- B Inside the equipment amount, because they are contents usual to the retailer's business
- C Inside the building amount, because they are kept in a fixture attached to the building
- D Outside the form, because money, tickets and evidence of debt are excluded property Correct
The property excluded clause takes out money, bullion, securities, stamps, tickets and tokens and evidence of debt or title, so cash and negotiable items have to be insured under a crime cover rather than under the property section.

Commercial Property Named Perils Form C100, clause 6 A (c) (Property Excluded) Reference document, not law.
Part IV of the Insurance Act carries the fire insurance statutory conditions. Which of the following covers, written for a commercial client, fall outside Part IV? Select all that apply.
- A Business interruption insurance, where the subject matter of the insurance is loss of profits. Correct
- B Insurance on the client's warehouse building against the peril of fire.
- C Boiler and machinery insurance. Correct
- D Insurance against loss or damage through theft, burglary or robbery. Correct
- E Insurance on the client's stock of goods at a fixed location against the peril of fire.
Subsection 143 (1) applies Part IV to insurance against fire damage to property but excepts boiler and machinery insurance, theft and burglary insurance, and insurance whose subject matter is rents, charges or loss of profits, so those three sit outside the fire statutory conditions.

Insurance Act, s. 143(1)
Under a commercial property named perils form, what does the smoke peril cover?
- A Smoke from any fire burning on or close to the insured premises
- B Smoke and soot from any heating or cooking appliance on the premises
- C Smoke from a sudden, unusual and faulty operation of a stationary furnace Correct
- D Smoke released by an industrial process carried on at the described location
The form limits the peril to smoke thrown off by a stationary furnace operating in a way that is sudden, unusual and faulty, so all three conditions and the furnace source have to be present, and the peril carries no liability for cumulative damage.

Commercial Property Named Perils Form C100, clause 5 (E) (Smoke) Reference document, not law.
A bakery's stock is insured under two property contracts placed by different brokers, both in force and both covering the same interest in that stock. A fire destroys $60,000 of stock. The two insurers have no written agreement between them about how a shared loss is handled. How is the loss settled?
- A The insured picks one insurer, which pays the whole $60,000 and cannot recover any of it from the other.
- B The insured may claim $60,000 under each contract and recover $120,000 in total.
- C Each insurer is liable to the insured for its rateable proportion of the $60,000 loss. Correct
- D The later contract is void for double insurance, so only the earlier contract responds.
Subsection 150 (1) of the Insurance Act splits a loss between contracts covering the same interest by rateable proportion unless the insurers have expressly agreed otherwise in writing, so both insurers contribute and the bakery is indemnified once.

Insurance Act, s. 150(1)
A crime cover distinguishes robbery from burglary and from theft. What makes a taking a robbery?
- A That the property was taken from a locked container somewhere inside the premises
- B That it was taken by violence or the threat of violence against a messenger or custodian Correct
- C That it was taken while the premises were open for business to members of the public
- D That it was taken by a person who entered the premises without any right to be there
Robbery means the taking of insured property by violence inflicted on a messenger or a custodian, by putting that person in fear of violence, or by another overt felonious act committed in that person's presence and of which the person was actually aware, so the definition turns on how the property was taken rather than on where it was kept.

Comprehensive Dishonesty Disappearance & Destruction Rider C800, Section 3 (Definitions, Robbery) Reference document, not law.
Under Section 6 of the Ontario Garage Automobile Policy OAP 4, when is no deductible payable by the insured on a specified perils claim for a customer's automobile?
- A Where the loss or damage is caused by theft of the entire automobile.
- B Where the loss or damage is caused by fire or lightning and those are insured perils. Correct
- C Where the customer's automobile is damaged beyond repair.
- D Where more than one customer's automobile is damaged in the same occurrence.
Subsection 6.7 waives the deductible where fire or lightning causes the loss and those perils are insured, so the insured pays nothing toward a fire claim on a customer's automobile even though a deductible is stated in the certificate.

OAP 4, subsection 6.7
What distinguishes a claims made liability policy from an occurrence policy?
- A A claims made policy responds to injury happening in the period, whenever the claim arrives
- B A claims made policy responds only to claims first made against the insured during the period Correct
- C A claims made policy responds to any claim arising out of conduct during the period
- D A claims made policy responds after the period, so long as the injury happened during it
A claims made policy covers only claims first made against the insured during the policy period and reported as the policy requires, while an occurrence policy responds to injury or damage happening during the period no matter when the claim eventually arrives.

Non-Profit Management and Corporate Liability Insurance Policy TDONPE.001, Policy face wording Reference document, not law.
A client is rear-ended at a red light in Ontario and is found not at fault. Both automobiles are insured under Ontario motor vehicle liability policies. The client's car needs $6,000 of repairs and the contents of the trunk are ruined, and the client wants to sue the other driver for the lot. What does the Insurance Act say about that?
- A The client may sue the other driver, and their own insurer will then subrogate against that driver.
- B The client must claim from the other driver's insurer, which pays the whole loss because its own insured was entirely at fault for the collision.
- C The client recovers from their own insurer and has no right of action against anyone else involved for that damage, the contents or loss of use. Correct
- D The client may choose between suing the other driver and claiming from their own insurer.
Section 263 routes damage to an insured automobile, its contents and loss of use to the insured's own insurer, and then removes the right of action against anyone else involved in the incident for those losses, so the not-at-fault driver collects from their own company rather than from the other driver.

Insurance Act, s. 263 (5)
A client lives with and looks after their disabled brother without being paid for it. They are injured in a collision and can no longer carry out those caregiving activities. Their policy, renewed after July 1, 2026, carries the optional caregiver benefit. What disability test must be met?
- A That the brother has no other family member able to step in and take over.
- B That the client was employed at the time of the accident and has had to pay another person to take over the care of their brother at home.
- C That the client's impairment is catastrophic within the meaning of the Schedule.
- D That the client suffers a substantial inability to engage in the caregiving activities they were doing at the time of the accident. Correct
Alongside the residence, primary caregiver and unpaid conditions, the benefit requires a disability test to be satisfied, namely a substantial inability, as a result of and within 104 weeks after the accident, to engage in the caregiving activities the person was doing at the time of it.

SABS, s. 13 (1)
A client was working full time when they were injured and now cannot perform the essential tasks of that job. Their policy, renewed after July 1, 2026, carries both the income replacement and the non-earner optional benefits. Which benefit fits their situation?
- A The non-earner benefit, because it pays a larger amount where the person cannot return to work in any capacity at all.
- B Both benefits together, because the client satisfies the test for each of them.
- C The income replacement benefit, because the client does not meet the non-earner condition of not qualifying for it. Correct
- D Neither benefit, because a person employed at the time of the accident is outside Part II.
The non-earner benefit is written for a person who does not qualify for an income replacement benefit, so a client who was employed and now cannot perform the essential tasks of that job sits on the income replacement side of the line. Both are optional benefits for policies issued or renewed on or after July 1, 2026.

SABS, s. 12 (1)

These are the same free questions the section pages publish, in one order instead of five. To work one section on its own, start from practice by section.