IIC RIBO-LEVEL-1 Online Practice Questions and Exam Preparation

IIC RIBO-LEVEL-1 Online Questions & Answers

• Question 231:

  A client calls their broker to report a minor fender-bender. They ask the broker if they can "look the other way" and not report it to the insurer so their rates don't go up.

  What is the broker's ethical obligation?

  A. Agree to keep it a secret as long as the client fixes the car out-of-pocket, to maintain the broker-client relationship.
  B. Advise the client that as their broker, they are obligated to act with integrity and transparency, and explain the risks of not reporting an accident.
  C. Report the accident immediately to the insurer without the client's consent to ensure the broker is personally protected.
  D. Tell the client to call another brokerage if they want to hide information, as this avoids a conflict of interest.
  B. Advise the client that as their broker, they are obligated to act with integrity and transparency, and explain the risks of not reporting an accident.

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  Explanation

  The broker must act with integrity and explain the consequences of hiding or failing to report an accident. Agreeing to conceal information is unethical and could prejudice coverage. Reporting without consent may also be inappropriate depending on the facts, so the broker should advise the client transparently and document the discussion.

• Question 232:

  A broker is approached by a high-net-worth client who wants to place their unique collector car insurance with an unlicensed US-based insurer because the rates are significantly lower.

  What is the broker's primary obligation?

  A. Place the coverage as requested to ensure the client is satisfied with the savings.
  B. Refuse the business because brokers are strictly prohibited from dealing with unlicensed insurers.
  C. Advise the client of the risks, obtain a signed "Unlicensed Insurer" disclosure, and ensure no licensed market is available.
  D. Tell the client to contact the US insurer directly so the broker can avoid any legal responsibility.
  C. Advise the client of the risks, obtain a signed "Unlicensed Insurer" disclosure, and ensure no licensed market is available.

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  Explanation

  Dealing with an unlicensed insurer is highly regulated and requires proper disclosure and care; the broker must not simply place the risk because the rate is lower. The selected response recognizes the need to advise the client, document the unlicensed insurer issue, and confirm that licensed markets are unavailable. Refusing all discussion or sending the client away avoids the broker's advisory responsibility.

• Question 233:

  From an insurance standpoint, which situation will the premises be considered "vacant"?

  A. When the occupants are away on vacation.
  B. When the occupants moved out and no new occupant has moved in.
  C. When they are closed up for the night.
  D. When the occupants are living elsewhere temporarily while major building repairs are being made.
  B. When the occupants moved out and no new occupant has moved in.

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  Explanation

  Premises are vacant when the occupants have moved out and no new occupant has moved in. Temporary absence for vacation, nightly closure, or temporary relocation during repairs is not the same as vacancy. Vacancy is important because property policies often restrict or require permits for vacant premises.

• Question 234:

  What does the "Standard Mortgage Clause" approved by the Insurance Bureau of Canada (IBC.

  and generally in use throughout the insurance industry outline?

  A. The terms and conditions of the agreement between the insured and the mortgagee in relation to their financial arrangement.
  B. The rights of the insurer, the obligations of the mortgagee and the rights of the mortgagee.
  C. The coverage for the benefit of the mortgagee.
  D. Notice to the mortgagee if the insurer fails to offer a renewal policy.
  B. The rights of the insurer, the obligations of the mortgagee and the rights of the mortgagee.

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  Explanation

  The Standard Mortgage Clause sets out the insurer's rights, the mortgagee's obligations, and the mortgagee's rights under the property policy. It is not the loan agreement between borrower and lender. Its purpose is to protect and define the mortgagee's insurance interest while preserving certain insurer remedies.

• Question 235:

  A well-known professional football player contacts you for Travel Health insurance. The football player tells you they intend to be scuba diving while away and asks if the Travel Health policy will respond to a claim if the football player is injured while in the water.

  How would you respond?

  A. The claim would be denied as the football player is a professional athlete.
  B. Travel health plan restrictions for sporting injury vary from insurer to insurer.
  C. The claim would be covered under all travel health policies.
  D. The exact circumstances of the injury occurring would determine whether or not a claim would be accepted.
  B. Travel health plan restrictions for sporting injury vary from insurer to insurer.

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  Explanation

  Travel health policies vary in how they treat sporting activities and hazardous pursuits such as scuba diving. A broker should not promise universal coverage or denial without reviewing the policy wording. The professional athlete status may be relevant only if the wording says so; the reliable advice is that restrictions vary by insurer and wording.

• Question 236:

  The RIBO Code of Conduct is outlined in Ontario Regulation 991, Section 14.

  Which provision is NOT outlined in the Code of Conduct?

  A. To maintain a Trust Account for all trust money received.
  B. To be both candid and honest when advising the member's client.
  C. Not to charge or accept any fee which is not fully disclosed prior to the service being rendered.
  D. To be competent to perform the services which the member undertakes on the client's behalf.
  A. To maintain a Trust Account for all trust money received.

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  Explanation

  Maintaining trust accounts is a regulatory requirement, but it is not the specific conduct provision listed in the Code of Conduct section being tested. Candour and honesty, disclosed fees, and competence are conduct obligations. The trust account requirement belongs to separate financial handling rules rather than that code provision.

• Question 237:

  Amir, a client, phones the Broker to advise that his insured vehicle is being repaired in a garage. Amir has just signed an agreement for a rental car. Under O.A.P.

  1, where would the coverage for his rental vehicle be found?

  A. Newly Acquired Automobile.
  B. Temporary Substitute Automobile.
  C. Ontario Policy Change Form (OPCF) 27 Legal Liability for Non Owned Automobiles.
  D. Ontario Policy Change Form (OPCF) 20 Coverage for Transportation Replacement.
  B. Temporary Substitute Automobile.

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  Explanation

  A temporary substitute automobile is the replacement vehicle used while the insured automobile is withdrawn from normal use because of repair, servicing, breakdown, loss, or destruction. The rental in this scenario is replacing Amir's own car while it is being repaired. OPCF 20 concerns reimbursement for transportation replacement costs, and OPCF 27 concerns legal liability for non-owned automobiles in other rental or borrowed vehicle situations.

• Question 238:

  Which one of these is not covered by cyber insurance policies?

  A. Loss of data storage equipment.
  B. Software restoration costs.
  C. Crisis communication management.
  D. Costs to defend lawsuits.
  A. Loss of data storage equipment.

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  Explanation

  Cyber insurance is aimed at data, systems, liability, response costs, restoration, crisis management, and defence costs arising from cyber events. Loss of the physical data storage equipment itself is a property or equipment issue unless a specific policy wording extends to it. The other items are common cyber loss or response categories.

• Question 239:

  In addition to the completed and signed application for automobile insurance, which two documents are included as part of an automobile policy?

  A. Certificate of automobile insurance and the Ontario Automobile Policy (OAP) 1.
  B. Proof of insurance card and the Ontario Automobile Policy (OAP) 1.
  C. Completed and signed endorsements that are attached to the application and proof of insurance card.
  D. Completed and signed accident benefits checklist and proof of insurance card.
  A. Certificate of automobile insurance and the Ontario Automobile Policy (OAP) 1.

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  Explanation

  The automobile policy package includes the completed application, the Certificate of Automobile Insurance, and the OAP 1 wording. The proof of insurance card is evidence for roadside purposes, but it is not the same as the policy contract components being tested. Endorsements are included when applicable, not as the basic two documents named here.