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IIC Essential Skills for the Insurance Broker and Agent Sample Questions:

1. W & A Insurers Inc. has a capacity of $30 million for any single property risk. It also has a reinsurance agreement with Tri-insurance Inc. for an additional $40 million. A broker approaches W & A Insurers Inc.
with a request to write a low-hazard $37 million liability risk. What is the insurer's retention if it accepts and reinsures the risk?

A) $37 million
B) $27 million
C) $40 million
D) $30 million


2. Which occupancy would be most attractive to an insurer reviewing a property's exposure?

A) Clothing store
B) Auto body shop
C) Scrap yard
D) Restaurant


3. Brenda works as a property and casualty underwriter in an industry that has some staged claims. Her accounts have a poor loss ratio and she has been put on a performance plan. She recently shadowed a senior broker for training purposes. He advised her on qualifying the client to establish whether the client and the brokerage can form a mutually beneficial business relationship.
She has just been approached by a new client, who would be the largest client in her portfolio. Describe what Brenda should keep in mind for her process regarding this client. How can Brenda qualify the client? Provide two questions she could ask if she suspects a moral hazard.


4. Trevor is cutting down a tree in his backyard. The tree accidentally falls onto his neighbour's shed, destroying the roof. Two weeks later, Trevor receives a document from his neighbour suing him for the damages to the shed and its contents. Which document has Trevor received?

A) Damages attestation
B) Statement of claim
C) Judgment notice
D) Statement of defence


5. Miro's vehicle and Stephanie's vehicle collide with each other in New Brunswick. Neither of them has loss or damage coverage, also known as collision coverage. The chart shows the physical damage and assigned fault.
How would the payment be apportioned?
Driver | Physical Damage | Fault Percent
Miro | $4,000 | 50%
Stephanie | $2,000 | 50%

A) Miro can collect $4,000 from his insurer; Stephanie can collect $2,000 from her insurer. Miro's insurer will subrogate against Stephanie's insurer for $2,000 and Stephanie's insurer will subrogate against Miro's insurer for $1,000.
B) Miro can collect $2,000 from his insurer and $1,000 from Stephanie's insurer; Stephanie can collect
$1,000 from her insurer and $500 from Miro's insurer.
C) Miro can collect $2,000 from his insurer; Stephanie can collect $1,000 from her insurer.
D) Miro can collect $2,000 from his insurer and $2,000 from Stephanie's insurer; Stephanie can collect
$1,000 from her insurer and $1,000 from Miro's insurer.


Solutions:

Question # 1
Answer: D
Question # 2
Answer: A
Question # 3
Answer: Only visible for members
Question # 4
Answer: B
Question # 5
Answer: C

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