C14 AUTO INSURANCE QUESTION SET WITH
RATIONALES AND MOTOR INSURANCE LAW
AND COVERAGE REVIEW 2026
◉ What happens when someone doesn't carry auto insurance.
Answer: -Fine for drivers who do not carry valid insurance (Ontario
$5k-$50k)
-Driver's license suspended and vehicle impounded
-May not have access to AB
-Be held personally liable and lose ability to sue at-fault party
◉ 8 Standard Policy Forms.
Answer: SPF 1 - Standard Owner's Automobile Policy (owner of veh)
SPF 2 - Standard Driver's Auto Policy (driving veh don't own)
SPF 4 - Standard Garage Auto Policy (repair shop)
QPF 5 - Complementary Insurance for Damage Caused to Insured
Vehicle Form (like OPCF 43)
SPF 6 - Standard Non-Owned Automobile Policy (responsible for use
and operation of non-owned veh)
SPF 7 - Excess Automobile Policy
SPF 8 - Lessor's Contingent Automobile Policy (business lease veh
long term)
,SPF 9 - Transportation Network Policy (ex: Uber)
◉ Tort System - Settling automobile insurance claims.
Answer: -Tort systems compensate victims based on TP's
fault/negligence
-Can go to civil justice system to recover damages
-Aim to compensate based on the degree they are not at fault
-Onus of proof on person claiming other negligent (except in case of
pedestrian)
-Driver's fault charts are used to settle common accident types
without the courts
◉ Direct Compensation System - Settling Automobile Insurance
claims.
Answer: -Compensated by their own insurer for damages caused by
third party
-Aim is less investigations, subrogation, litigation
-Faster settlements which in turn gives cost savings
-Access to civil justice system is limited/banned
-Insureds cannot claim against TP's
-Negotiates with own insurer
◉ Negligence definition.
,Answer: -Failure to use the degree of care expected from a
reasonable and prudent person
◉ Automobile Third Party Liability Insurance Covers:.
Answer: -Legal liability for bodily injury or death of any person
-Damage to property of others due to your ownership/use of your
veh
-Insured persons
*are minimum limits
*law also provides priority of payments
◉ Automobile Third Party Liability Insurance Exclusions.
Answer: -Damage to property carried in or upon the automobile
-Damage to other property owned or rented by, or in the care,
custody or control of insureds
-Contamination of property being carried
-Nuclear hazards
-Amounts over the policy limit purchased - other than legal costs
and post-judgment interest
◉ Additional Coverage Available Under Third Party Liability.
Answer: 1. Pay all costs taxed against insureds within limits of policy
2. Reimburse the cost of medical aid
, 3. Investigate, negotiate, and settle claims
4. Defend insureds
5. Pay up to minimum limits of province where accident happened
6. Follow the law of the jurisdiction
7. Protect insureds for liability claims
◉ Responsibilities of Insured Persons.
Answer: 1. Notify insurer in writing within 7 days of loss or damage
2. Give insurer a statutory declaration
3. If asked help the insurer with the investigation
4. Do not assume liability
5. Reimburse the insurer for any payments required by law
◉ Rental Vehicles Order of Liability.
Answer: 1. Person who rented the automobile
2. The driver of the automobile
3. The owner of the automobile
◉ Non-Economic Losses.
Answer: -Payment for loss or harm can't be quantified money (pain
and suffering)
-Lawsuits subject to a per-person deductible
RATIONALES AND MOTOR INSURANCE LAW
AND COVERAGE REVIEW 2026
◉ What happens when someone doesn't carry auto insurance.
Answer: -Fine for drivers who do not carry valid insurance (Ontario
$5k-$50k)
-Driver's license suspended and vehicle impounded
-May not have access to AB
-Be held personally liable and lose ability to sue at-fault party
◉ 8 Standard Policy Forms.
Answer: SPF 1 - Standard Owner's Automobile Policy (owner of veh)
SPF 2 - Standard Driver's Auto Policy (driving veh don't own)
SPF 4 - Standard Garage Auto Policy (repair shop)
QPF 5 - Complementary Insurance for Damage Caused to Insured
Vehicle Form (like OPCF 43)
SPF 6 - Standard Non-Owned Automobile Policy (responsible for use
and operation of non-owned veh)
SPF 7 - Excess Automobile Policy
SPF 8 - Lessor's Contingent Automobile Policy (business lease veh
long term)
,SPF 9 - Transportation Network Policy (ex: Uber)
◉ Tort System - Settling automobile insurance claims.
Answer: -Tort systems compensate victims based on TP's
fault/negligence
-Can go to civil justice system to recover damages
-Aim to compensate based on the degree they are not at fault
-Onus of proof on person claiming other negligent (except in case of
pedestrian)
-Driver's fault charts are used to settle common accident types
without the courts
◉ Direct Compensation System - Settling Automobile Insurance
claims.
Answer: -Compensated by their own insurer for damages caused by
third party
-Aim is less investigations, subrogation, litigation
-Faster settlements which in turn gives cost savings
-Access to civil justice system is limited/banned
-Insureds cannot claim against TP's
-Negotiates with own insurer
◉ Negligence definition.
,Answer: -Failure to use the degree of care expected from a
reasonable and prudent person
◉ Automobile Third Party Liability Insurance Covers:.
Answer: -Legal liability for bodily injury or death of any person
-Damage to property of others due to your ownership/use of your
veh
-Insured persons
*are minimum limits
*law also provides priority of payments
◉ Automobile Third Party Liability Insurance Exclusions.
Answer: -Damage to property carried in or upon the automobile
-Damage to other property owned or rented by, or in the care,
custody or control of insureds
-Contamination of property being carried
-Nuclear hazards
-Amounts over the policy limit purchased - other than legal costs
and post-judgment interest
◉ Additional Coverage Available Under Third Party Liability.
Answer: 1. Pay all costs taxed against insureds within limits of policy
2. Reimburse the cost of medical aid
, 3. Investigate, negotiate, and settle claims
4. Defend insureds
5. Pay up to minimum limits of province where accident happened
6. Follow the law of the jurisdiction
7. Protect insureds for liability claims
◉ Responsibilities of Insured Persons.
Answer: 1. Notify insurer in writing within 7 days of loss or damage
2. Give insurer a statutory declaration
3. If asked help the insurer with the investigation
4. Do not assume liability
5. Reimburse the insurer for any payments required by law
◉ Rental Vehicles Order of Liability.
Answer: 1. Person who rented the automobile
2. The driver of the automobile
3. The owner of the automobile
◉ Non-Economic Losses.
Answer: -Payment for loss or harm can't be quantified money (pain
and suffering)
-Lawsuits subject to a per-person deductible
