OTL - Ontario Automobile Insurance
Licensing Supplement Study Guide
Exam and Actual Answers.
precedent - Answer a legal decision that serves as a basis to resolve subsequent disputes
with similar cases
what does the federal government deal with? - Answer deals with criminal law, trade b/t
provinces, telecommunications, customs and immigration and fisheries
what does the provincial government deal with? - Answer makes laws based on education,
property, health, sets out the rules of the road like speed limits, traffic lights and stop signs, who
has the right of way
Municipal Bylaws - Answer dealing with local matters like: zoning, smoking, animal control
and the issuance of construction permits
Third Party Liability - Answer insurance against the insureds legal liability for injury to other
people and damage to the property of others arising out of ownership or operation of an
automobile
DCMP - Answer covers damages or the loss of use of an automobile or its contents if the
other vehicle was at fault for the accident
facility association - Answer Ensures that drivers unable to obtain insurance with an
individual company are able to obtain the coverage they need to operate their vehicles legally.
The insurance companies act - Answer governs all federally incorporated or registered
insurance companies in canada
-sets out the basic provisions
-prescribes certain general rules to all policies
-each province has its own insurance act
highway traffic act - Answer -the registration and licensing of motor vehicles and traffic
controls
-every province has its own
, Compulsory Automobile Insurance Act - Answer requires every owner or lessess of a vehicle
to insure that vehicle if it is being operated on public roads
duty of disclosure - Answer the duty of disclosure is to the principle of utmost good faith that
underlies all insurance transactions
Representation - Answer a statement either expressed or implied that an applicant makes to
an insurer about risk to be insured so the risk may be property assessed
what is found under the policy term - Answer -effective date and expiry
what is found under the subject of insurance - Answer the subject is the thing being insured
and clients legal responsibility
Loss Payee - Answer someone other than the named insured to whom the proceeds of
insurance is paid.
has insurable interest
-for mortgages interests are protected by a seperate insuring clause known as the mortgage
clause
rate - Answer the price of one unit of insurance for one year
used to calculate premium by multiplying rate times the amount of insurance purchased
the process of establishing rates - Answer 1. classify risks
2. gather stats on past losses
3. calculate pure premium
4. calculate total premium including loadings
5. calculate the rate or unit cost
what increase the reliability in probability of loss - Answer size of sample, period over which
the sample was taken, and conditions in past and future
why are risks rejected? - Answer insurer may not insure that class of business
the risk may be so much more hazardous
risk may be substandard
retention - Answer the amount of liability the ceding company retains for its own account
Licensing Supplement Study Guide
Exam and Actual Answers.
precedent - Answer a legal decision that serves as a basis to resolve subsequent disputes
with similar cases
what does the federal government deal with? - Answer deals with criminal law, trade b/t
provinces, telecommunications, customs and immigration and fisheries
what does the provincial government deal with? - Answer makes laws based on education,
property, health, sets out the rules of the road like speed limits, traffic lights and stop signs, who
has the right of way
Municipal Bylaws - Answer dealing with local matters like: zoning, smoking, animal control
and the issuance of construction permits
Third Party Liability - Answer insurance against the insureds legal liability for injury to other
people and damage to the property of others arising out of ownership or operation of an
automobile
DCMP - Answer covers damages or the loss of use of an automobile or its contents if the
other vehicle was at fault for the accident
facility association - Answer Ensures that drivers unable to obtain insurance with an
individual company are able to obtain the coverage they need to operate their vehicles legally.
The insurance companies act - Answer governs all federally incorporated or registered
insurance companies in canada
-sets out the basic provisions
-prescribes certain general rules to all policies
-each province has its own insurance act
highway traffic act - Answer -the registration and licensing of motor vehicles and traffic
controls
-every province has its own
, Compulsory Automobile Insurance Act - Answer requires every owner or lessess of a vehicle
to insure that vehicle if it is being operated on public roads
duty of disclosure - Answer the duty of disclosure is to the principle of utmost good faith that
underlies all insurance transactions
Representation - Answer a statement either expressed or implied that an applicant makes to
an insurer about risk to be insured so the risk may be property assessed
what is found under the policy term - Answer -effective date and expiry
what is found under the subject of insurance - Answer the subject is the thing being insured
and clients legal responsibility
Loss Payee - Answer someone other than the named insured to whom the proceeds of
insurance is paid.
has insurable interest
-for mortgages interests are protected by a seperate insuring clause known as the mortgage
clause
rate - Answer the price of one unit of insurance for one year
used to calculate premium by multiplying rate times the amount of insurance purchased
the process of establishing rates - Answer 1. classify risks
2. gather stats on past losses
3. calculate pure premium
4. calculate total premium including loadings
5. calculate the rate or unit cost
what increase the reliability in probability of loss - Answer size of sample, period over which
the sample was taken, and conditions in past and future
why are risks rejected? - Answer insurer may not insure that class of business
the risk may be so much more hazardous
risk may be substandard
retention - Answer the amount of liability the ceding company retains for its own account
