Question 1

A broker is using their prior market knowledge to place a risk with an insurer who accepts luxury log cabins. Which insurer aspect is the broker considering?

Options :

A : Risk appetite

B : Risk management

C : Risk avoidance

D : Risk tolerance

Answer: A

Question 2

A broker is preparing to meet with a prospective client, Queen Ice Cream, who manufactures and distributes ice cream to five different provinces. What can the broker ask to ensure a smooth transition for the client?

Options :

A : How many flavours of ice cream does the client sell?

B : How long has the client been in business?

C : How many competitors are in the market?

D : Do all existing policies expire at the same time?

Answer: D

Question 3

An architect is sued by a client for having failed to account for local bylaws when designing a new home. For the insurance company to defend the architect, which coverage must he have in place?

Options :

A : Wrap-up liability

B : Errors and omissions

C : Explosion, collapse, and underpinning

D : Commercial building, equipment, and stock

Answer: B

Question 4

XYZ Insurer is known for using the first-in principle. If multiple brokers request quotations for a new applicant, how does XYZ Insurer respond?

Options :

A : Cooperates with the largest brokerage

B : Releases quotes for each broker sequentially

C : Blocks itself from dealing with other brokers on the risk

D : Negotiates with each broker based on the same terms and conditions

Answer: C

Question 5

Insurance premiums on automobile fleet policies are based on which factor?

Options :

A : Overall experience of all drivers

B : Driving record of the individual drivers

C : Original purchase price of all vehicles in the fleet

D : Mechanical condition of a vehicle from one particular fleet

Answer: A