A stock company is… a. A company that invests in other companies b. A company owned by stockholders who provide the capital to start and run the company c. Is owned by customers of the company d. A company that owns livestock
The most basic form of coverage is coverage from fire losses. The Insurance Act in Canada also ensures there is coverage for…
The difference between pure and speculative risk is… a. Speculative risk is insurable but pure risk is not b. Speculative risk means that there is a chance to gain or lose whereas one can only lose with pure risk c. Speculative risk means that there is only the chance to lose whereas pure risk means you have a chance to win too d. Speculative risk is a term invented by marine insurance companies in 1864
A legally enforceable agreement between 2 or more parties is a… a. A contract b. An agreement c. A will d. A contract of consideration
What are the 4 methods of dealing with risk?
A reduction in value is called a… a. Loss b. Unlucky situation c. Claim d. Transfer
What elements must be present to constitute a legal contract? a. Parties to the contract, the contract itself, consideration b. Parties to the contract, a written document, consideration, and legal purpose c. Agreement, consideration, legality of object, legal capacity, genuine intention d. Competent parties, consideration, warranty, and legal purpose
The act of intentionally giving up some right or privilege is… a. A representation b. A transfer c. A waiver d. Subrogation
Insurance purchased by an insurance company is called a. Reinsurance b. Risk avoidance insurance c. Full protection d. Umbrella insurance
The main purpose of an insurance contract is to… Allow the spread of risk
A person has a few options when dealing with financial risk: avoidance, retention, control, and transfer. Which is usually the best option for most people? a. Avoidance b. Retention c. Transfer d. Control
Who below has the legal capacity to enter into an insurance contract? a. Buck’s Consulting b. Black’s Hardware c. Tess’ Restaurants Ltd. d. Jerry’s Convenience
A binder is… a. An interim contract of insurance b. Permitted for all risks c. Binds the insured to certain terms specified by the insurer d. Binds the insured to certain terms specific by the brokerage
What does an insurer issue when both parties have agreed to change certain policy terms? An endorsement
In Canada, the insurance industry is regulated on both a federal and provincial level. The provincial government is responsible for… a. Supervising the terms of insurance contracts b. Licensing insurance companies to do business in the province c. None of the above d. Both a and b
Solvency means… The ability of an insurer to pay all insured losses
What are the fiduciary responsibilities of a broker? Unearned commissions are to be held in trust and paid back if the policy is cancelled before expiry. Premiums collected must be forwarded to the insurer.
According to the Insurance Act when does a contract of insurance takes effect? 12:01 am standard time at the address of the named insure
The removal clause is a common policy clause that requires insurers extend coverage to another location where the insured’s property is kept when…
After the insurer had indemnified the insured for loss, the insurer has the legal right to recover from the at fault party. This right is known as… subrogation
When is a misrepresentation OK and not considered a violation of your statutory conditions?
What is the definition of misrepresentation? A misstatement or fraudulent omission of a material factto the prejudiceof the insurer
Regarding the statutory condition around termination, which 1 of the 4 provisions is wrong? a. Your client does not have to give the insurer any prior notice to cancel b. On termination, the insured is not entitled to a premium refund c. The insurer has the right to change the policy administration costs so refunds are calculated on a short-rate basis d. Written request for termination, signed by all parties named on the policy must be provided to insurer
What are the consequences of claims fraud when discovered by the insurer? (i.e. if your client claimed something that wasn’t actually damaged in the house fire) The claim is VOID
What is the insurer’s duty if they choose to repair property instead of issue a cash payment? When the insurer chooses to repair property, it must give written notice within 30 days of receiving the Proof of Los
An insurance contract is only legally enforceable when it has all of these 3 elements: Insurable interest, utmost good faith, indem
A broker’s most important duty is to… A broker must always be truthful and disclose all material facts about the client’s risk to the insurer
What is the role of the broker in the insurance process? An intermediary between the client and the insurer
The law requires that brokers exercise “reasonable skill, care and diligence”. If they don’t errors and omissions claims may arise. The main reason for E&O claims is… Failing to identify client’s loss exposures and offering adequate coverage
The primary function of an underwriter is to… Select risks that are most likely to be profitable for the insurer
When an underwriter looks at the financial and claims history of the applicant, they are looking for… a. Morale hazard b. Moral hazard c. Physical hazard d. Risks
Insurance policies are designed to insure against “direct damage” only. Yesterday, a fire destroyed 65% of your client’s apartment building. What is the likely not covered in this situation? Loss of rental income
What is a condition? A requirement to do or not do something
What is a warranty? And give 1 example of a common warranty. A promise that something is true and will remain true (i.e. a locked vehicle warranty)
What is the definition of insurance? The undertaking by one person to indemnify another against loss or liability in respect to a certain risk or peril
What is the definition of contract? An agreement between people to do or not do something
What is the definition of risk? Chance of financial loss
What is the principle of indemnity? The principle of indemnity ensures that people receive the actual amount of their loss –no more, no less
What is an insurance binder? A temporary agreement where the insurer agrees to provide certain coverages pending the issuance of a policy
What is an agency agreement? A contract between the insurer and the brokerage
What is a void contract? A contract where one cannot legally support its intended purpose. In this case, the contract never existed
What is a peril? Cause of loss
What is the difference between a direct loss and an indirect loss? A direct loss occurs when a peril directly attacks the object of insurance. Indirect losses are losses that arise as a consequence of a direct loss
What is a valued policy? This is where the insured and insurer agree on the cash value of the property. If a loss occurs, this is the amount that would be paid.
What is insurable interest? One has insurable interest if they would suffer financially from a loss
What is utmost good faith? With insurance contracts, you must maintain a higher standard of honesty than with other contracts. This applies to the insured, insurer and the broker
What is a fiduciary? Someone who has a special position of trust when handing the affairs or funds of another
What is the difference between a friendly fire and a hostile fire? A friendly fire is a fire contained in its proper receptacle. Once that fire passes outside its boundaries, it becomes a hostile fire. (ie. a spark escapes the fireplace and burns the carpet)
What is the difference between pro-rata and short rate forms of premium return calculation? Pro-rata means calculating the premium refund by dividing the amount of premium paid by the number of days left remaining on the policy. Short rate is pro-rata minus any administrative charges or cancellation penalty.
What is the insured’s responsibility when it comes to providing notice of loss? The insured or his representative must immediately report the loss to the insurer in writing
What is proof of loss? A formal verification, under oath, of the details and amounts claimed.
What is fraud? A deliberate attempt to deceive with the aim of financial gain.
What is a deductible and why does it exist? The amount the insured is required to absorb for each loss before insurer pays out. A deductible exists to reduce the number of petty claims
Explain the idea of subrogation. When an insurer pays a claim for a loss caused by a 3rdparty, the insurer is allowed to place itself “into the insured’s shoes” and take on their legal rights (ie. to sue the responsible party)
What is considered “personal property”? Contents of the dwelling, personal property used by insured while on premises and contents usual to the ownership/maintenance of the dwelling.
What is the definition of a vacant property? All occupants have moved out with no intention of returning and no new occupants.
What is theft? All means of taking property without owner’s consent.
What is an endorsement? A written agreement between the insured and the insurer to change some terms of the insurance contract.
What is the difference between criminal law and civil law? Criminal law deals with wrongs against society. Civil law is for disputes between individuals/legal entities.
What is a tort? A wrong done by another person’s breach of legal duty
Provide 3 examples of tort : Trespass, nuisance, defamation, false arrest, invasion of privacy, or negligence (非法侵入、妨害公共秩序、诽谤、非法逮捕、侵犯隐私或疏忽)
3 elements of a tort: Duty owed, duty breached & damages resulted (proximately) (应尽义务、违反义务及由此造成的损害（直接或间接）)
Which type of tort is insurable? Unintentional torts
What is strict liability and when does it apply? Strict liability assumes a person is guilty until proven innocent. This typically applies to cases where the person is doing something inherently dangerous
What is negligence? Carelessness: not doing what a reasonable man in the same situation would have done, or doing something a reasonable man would not have done
There are 4 broad types of people who might seek to enter your premises. What are these 4, define them and explain the duty you owe to each. a.Trespasser: entering without permission from occupieri.Duty owed: no legal duty owed but cannot set traps or cause intentional harmb.Licensee: someone entering for their own purpose with permission from occupieri.Duty owed: warn of any hazards known to occupier that licensee would not expectc.Invitee: invited in for benefit of the occupieri.Duty owed: protect against dangers down or might reasonably discover
What is the liability of a landlord in a building with multiple tenancy? Responsible for common areas
How do you determine the liability of a bailee for customer’s goods? Under the 2 types of civil law: a. Tort law: must exercise ordinary care b. Contract law: for responsibilities assumed under contract
Explain the liability of employers for the tort of their employees :Employers are generally liable unless: a. Employees delegated their work without employer’s consent b. While on a frolic of their own c. Employee used property without authorization for their own purpose
Explain the concept of general average : Provides payment for ocean marine losses voluntarily incurred to save the entire venture. The parties whose property was saved would contribute to repay the sacrificed party.
Identify 3 categories of risk : Personal risk, property risk, liability risk (GPT said Pure Risk Speculative Risk Fundamental Risk)
Explain the statutory condition of salvage. The insured is legally required to take reasonable steps to protect property from further damage.
What is a physical hazard and provide 3 examples. Condition related to premises (construction, occupancy, housekeeping) (GPT Icy sidewalks Faulty electrical wiring Defective machinery (or smoking in bed))
A moral hazard is… Subjective characteristics of the applicant that could cause a peril — Moral Hazard（道德危险 – 欺诈）
What is the main difference between “named perils” and “all risk” policies as typically provided by insurers. Named perils cover FSWILLER only. All risks covers all direct losses not excluded
What are the 3 types of property insured under a commercial property policy? Building, stock and equipment
Briefly explain explosion coverage under homeowners form. Covers damage caused by hot water heaters and domestic boilers not due to water hammer
Briefly explain smoke coverage Covers losses out of sudden, unusual and faulty operation of stationary furnace
What do homeowners forms typically exclude in the context of impact by aircraft or land vehicles? Damaged caused by insureds
What do homeowners forms typically exclude in the context of windstorm and hail? Excludes loss or damage to antennae and satellite dishes.
What do homeowners forms typically exclude in the context of theft? Excludes theft by tenant, employee or member of household.
What are 5 coverages in broad form that aren’t in named perils forms? a. Vehicle impact to insured’s building when driven by insured b. All sources of smoke damage excluding industrial operations c. Water damage due to freezing or rupturing of water lines d. Theft e. Collapse (excluding earthquake or faulty workmanship)
84.What are 5 factors insurers look at to determine the base rate for commercial property? Construction, protection, occupancy, location, claims history
85.A “building” is defined as… a. Fixed structures b. Additions/extensions c. Permanent fittings d. Materials on premises for regular maintenance e. Growing plants inside the building for decoration Building = Permanent structure attached to the ground, including fixtures and permanently installed equipment.
86.Stock is defined as… Stock is merchandise held in storage or for sale, raw materials, and goods in process or finished goods.
RIBO 最爱考的区别
项目
Building
Contents
Stock
建筑物本身
✅
❌
❌
固定暖气系统
✅
❌
❌
办公家具
❌
✅
❌
电脑
❌
✅
❌
待出售商品
❌
❌
✅
原材料
❌
❌
✅
在制品
❌
❌
✅
Building
Permanent structure attached to the ground.
Contents
Property used to operate the business.
Stock
Property the business makes, stores, or sells.
87.What is the formula for calculating co-insurance? Did/should x amount of loss Insurance Carried÷Insurance Required×Loss
88.What is the reinstatement clause? Same amount of insurance after the loss as before the loss
Don’t confuse:
Clause
Meaning
Reinstatement Clause
Restores the policy limit after a loss
Replacement Cost Clause
Pays cost to replace property without depreciation
Co-insurance Clause
Requires insurance to a specified percentage of value
89.When can an insurer not subrogate against you? An insurer cannot subrogate against its own insured.
（保险公司不能向自己的被保险人行使代位求偿权。）
90.What responsibilities does an insured have under the property protection systems clause? Maintain protective systems and notify the insurer of any impairment or suspension.
The insured must maintain all protective devices and systems in working order and notify the insurer of any impairment or suspension of those systems.
91.What are 2 key coverages under boiler and machinery (aka equipment breakdown)? Property Damage Coverage Business Interruption Coverage
92.Do business interruption policies cover any perils excluded the corresponding property policy? No. Business interruption insurance only covers losses resulting from an insured peril covered under the corresponding property policy.
Business Interruption requires:
Direct physical loss or damage caused by an insured peril.
即：
必须先有：
Direct physical damage（直接财产损失）
Covered peril（承保风险）
然后才触发营业中断赔偿。
Excluded Peril + Endorsement → Covered Peril
Covered Peril → Business Interruption may respond
93.What is the basic difference between the earning form and the profits form?
Earnings form ends when property has been replaced. Profits form ends when income is restored to pre-loss levels
Earnings form looks at gross income (sales-based), while profits form looks at net profit (profitability-based).
96.Liability coverages on the homeowners forms do not usually insure damage arising out of business activities, what are the 3 exceptions?
The 3 exceptions:
a. Personal actions during work not directly related to job
b. Rental portions of your home (up to 2 roomers/boarders)
c. Temporary or part-time business of an insured person under 21
但有 3 个常见例外（Exceptions）：
1. Activities of a Minor Child
未成年子女偶尔从事的小型业务活动。
✅ 例子：
Babysitting
Lawn mowing
Newspaper delivery
这些通常仍受个人责任险保障。
2. Part-Time Business Activities
兼职业务，收入有限且规模较小。
✅ 例子：
偶尔做家教
偶尔做簿记工作
临时翻译工作
（具体金额和条件以保单条款为准。）
3. Volunteer Activities
义工或非营利性质的活动。
✅ 例子：
社区组织义工
教会义工
慈善机构志愿服务
由于不是为了获取商业利润，通常不被视为业务活动。
RIBO 考试标准答案
Three common exceptions to the business pursuits exclusion under a homeowners liability policy are:
Business activities of a minor child.
Part-time or incidental business activities.
Volunteer or charitable activities.
考试口诀
Minor – Part-time – Volunteer
（小孩、兼职、义工）
这是 Homeowners Liability 章节中关于 Business Pursuits Exclusion 最常考的三大例外。
97.Name 3 workers compensation plan benefits: Necessary health care costs, lost earnings, death benefit
RIBO 考试常见答案：
Income Replacement Benefits
替代因工伤或职业病导致无法工作的收入损失。
例如：受伤后无法工作，获得工资补偿。
Medical and Rehabilitation Benefits
支付医疗费用及康复费用。
包括医生、医院、药物、物理治疗等。
Survivor (Death) Benefits
如果工伤导致员工死亡，向配偶和受抚养人提供赔偿。
可能包括一次性死亡赔偿金和持续收入补助。
98.What is an elimination period? A period of self-insurance between the start of disability and the start of benefits
✅ Key words to remember: “Waiting period before benefits begin.”
99. Who has insurable interest under Accident & Sickness insurance? The insured himself & spouse, employee, child, anyone with pecuniary interest, dependents
❓ Can you buy Accident & Sickness insurance on a stranger?
❌ 不可以。
必须存在：
家庭关系（Family relationship）
经济依赖关系（Financial dependency）
商业关系导致经济损失（Economic loss）
否则没有可保利益。
RIBO 一句话背诵版
Insurable interest exists when a person would suffer a financial loss if another person became injured, sick, disabled, or died.
常见对象：
SELF + SPOUSE + CHILDREN + EMPLOYER/EMPLOYEE + CREDITOR/DEBTOR
100.Who qualifies as a dependent under travel insurance? Anyone under 20 (26 if in college), unmarried, living with and receiving full support from insured. Or anyone with mental of physical deformity.
Q: Does a parent automatically have an insurable interest in an adult child?
A: No. A parent only has an insurable interest in an adult child if the parent would suffer a financial loss due to the child’s injury, disability, sickness, or death.
Substantial Inability to Perform the Essential Tasks
（无法完成其工作的主要职责）
3. 事故发生前符合收入要求
通常：
在事故前 52 周内：
有工作收入；或
在事故发生时正在工作。
IRB 金额如何计算？
标准保障
最高：
$400/Week
（税后）
大约是：
收入的 70%
但最高不超过 $400/周。
可以购买提高额度
例如：
增加到：
$600/week
$800/week
$1,000/week
（通过 Optional Benefits）
自雇人士如何证明收入？
这是考试和实际理赔中的重点。
保险公司可能要求：
Income Tax Return
报税记录
T1 General
个人报税表
Notice of Assessment
CRA 评税通知
Business Financial Statements
财务报表
Invoices
发票记录
Bank Statements
银行流水
举例
John 是保险经纪
年收入：
$80,000
发生车祸后：
6个月无法工作。
虽然：
没有固定工资单（Pay Stub），
但：
通过：
T1
NOA
Commission Statements
证明收入。
则：
✅ 可以领取 IRB。
RIBO 高频陷阱
Q1
自雇人士是否可以领取 IRB？
A. 不可以
B. 可以
✅ 答案：B
Q2
IRB 是否仅适用于受雇员工？
A. 是
B. 否
✅ 答案：B
Q3
John 自营装修公司。
因事故无法工作。
最可能获得：
A. Death Benefit
B. Income Replacement Benefit
C. DCPD
D. OPCF 44R
✅ 答案：B
与 NEB（Non-Earner Benefit）的区别
IRB
NEB
有工作收入
无工作收入
包括自雇人士
学生、失业者等
补偿收入损失
补偿生活功能受影响
标准最高 $400/week
金额较低
超级陷阱题
John 是自雇水管工。
事故前收入：
$120,000/年。
未购买 Optional IRB。
事故后完全不能工作。
最高标准 IRB 是：
A. $400/week
B. $1,200/week
C. $2,300/week
D. 全额收入
✅ 答案：A
因为：
标准 IRB 的上限是 $400/week。
RIBO 考场口诀
Employee 有 IRB；
Self-employed 也有 IRB；
没有收入才看 NEB。
一句话总结
Self-employed individuals are eligible for Income Replacement Benefits if they were employed at the time of the accident and are substantially unable to perform the essential tasks of their occupation because of the accident.
Section 5.3.3 provides that where the described automobile is leased or rented, the insurer’s liability under Uninsured Automobile Coverage is limited to the actual cash value of the automobile and duplicate recovery is not permitted.
Section 5.4 provides coverage for damage to the insured automobile caused by an uninsured or unidentified automobile, subject to a $25,000 limit and a $300 deductible.
