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What does RIBO stand for?
- Registered Insurance Brokers of Ontario.
- - self-governing
- - for general insurance brokers
What happened on Oct 1, 1981?
- - insurance brokers in Ontario were granted self-regulation
- - government legislation entitled the Registered Insurance Brokers of Ontario Act
- - this legislation protects the interests of insurance consumers
What does RIBO regulate?
- RIBO regulates the following of all general insurance brokers:
- - licensing
- - professional competence
- - ethical conduct
- - insurance related financial obligations
How are complaints against a broker handled?
- - RIBO investigates complaints
- - has the authority to suspend or restrict the licenses of individual brokers or brokerage firms
What authority does RIBO have?
- Suspend or restrict the licenses of:
- - individual brokers
- - brokerage firms
How often are the financials reviewed by RIBO?
- - twice annually
- - done for all brokerages
- - ensures compliance with the financial requirements of the Act
- - **Form 1 Position Report**
How many people are in the RIBO council?
- - 13 people
- - 9 elected brokers & 4 public members appointed by the Lieutenant governor in council
- the council acts like a Board of Directors, same as any business company
What are the council's responsibilities?
- - supervising the management of the corporation
- - setting policies and guidelines
RIBO exercises its authority through which 3 committees?
(Quiet Cat Dog)
- 1. Qualification/Registration Committee
- 2. Complaints Committee
- 3. Discipline Committee
What are the duties of the Qualification & Registration Committee?
- - set and review qualification standards
- - ensure compliance of standards
What are the duties of the Complaints Committee?
- - investigates misconduct
- - determines if allegations warrant referral to Discipline Committee
What are the duties of the Discipline Committee?
- - conducts hearings into professional misconduct by brokers
- - similar to a trial in civil court
- - decides if innocent or guilty
- - if found guilty, may impose an appropriate penalty from reprimand to license suspension
What are the 5 departments of RIBO?
(Quiet Cat Mac)
- 1. Qualification & Registration Dept
- 2. Complaints & Investigation Dept
- 3. Marketing & Communication Dept
- 4. Administration & Finance Dept
- 5. Corporation Legal Services Dept
Describe the duties of the Administration & Finance department.
- - financial matters
- - clerical & office services
- - personnel
- - technology
Describe the duties of the Complaints & Investigation department.
- - monitoring broker conduct, financial position, & marketing plans
- - spot checks (pre-arranged visits) every 3-5 years to review books
- - hears complaints from brokers & public
- - most complaints handled over the phone (90%)
- - more serious complaints are assigned to an investigator
- - when enough evidence, a report is given to Complaints Committee for review
- - Complaints Committee may refer matter to Discipline Committee (tribunal hearing & testimony under oath)
Describe the duties of Corporate Legal Services dept.
- - provides legal services to council, committees & all dept's
- - most services are provided to the 3 main committees
- - reports to General Manager
- - provides council to any RIBO member on the RIBO Act
Describe the duties of the Communication & Marketing dept.
- - all marketing materials
- - newsletters
- - meet with brokers in the province (usually 10 locations across province) to discuss issues in member forums
- - responsible for Annual Meeting and liaison with the media
Describe the duties of the Qualification & Registration dept.
- - administers the Q&R requirements of the RIBO Act
- - operational support to the Q&R committee
- - reviews all applications for brokers
- - reviews renewal applications for education compliance
- - responsible for broker exams
How does the RIBO Act define an insurance broker?
- - act or aid in any manner in soliciting or procuring the making of any contract of insurance or reinsurance
- - whether or not he has an agreement with insurers allowing him to bind coverage or countersign insurance documents on behalf of insurers
- - a broker my also provide risk management services including claims assistance where needed
List 3 important quotes from the RIBO Act.
1. No person shall act as an insurance broker unless that person is a registered insurance broker under this act (does not include clerical people)
2. A broker shall provide a policy or certificate of coverage to the client within 21 days
3. Fees for services are allowed providing that the fee has been disclosed to client (amount of the fee, portion of premium retained, total premium)
Within how many days shall a broker provide proof of coverage?
What are the 4 broker responsibilities?
- 1. Give knowledgeable advice on insurance
- 2. Counsel on risk management
- 3. Give adequate knowledge of risk to insurer
- 4. Co-operative with insurer
Describe the broker trust account.
- - PREMIUMS received from clients for policies to be issued must be deposited into the trust account
- - no later than 3 days after money received
- - COMMISSION may be withdrawn from the trust account to the general account
What does Fiduciary mean?
- - brokers are fiduciary in nature
- - a person or firm who occupies a position of special trust or confidence in handling or supervising the affairs or funds of others (ie. banks, brokers, barristers)
What is required of a Broker in the Complaints Procedure?
- - If the inquiry can't be solved via telephone then a written complaint is required and the broker is notified
- - the broker has 2 weeks to respond in writing to RIBO
- - this is reviewed to determine if there is a violation of the Act
If a broker has violated the Act, what are the procedures?
- - if there is a violation, the matter is brought before a complaints committee meeting
- - if they believe an offense has been committed they direct the matter to the Discipline Committee
- - they have the power to revoke, place conditions on, or impose a fine payable to the Treasurer of Ontario
Who can be an Insurance Broker?
- - over the age of majority (18yrs)
- - of good character
- - no past legal charges
- - has not had a license under the Insurance Act that was refused or revoked
- - meets the education & experience requirement
- - complies with regulations of this Act
- - only business is of an insurance broker including the sale of life insurance and any other business approved by RIBO
When does a RIBO certificate expire?
- September 30th of every year
How soon must RIBO be notified of changes of a Brokers status?
- within 30 days of change taking place
Can a broker issue insurance with an unlicensed insurer?
- - not unless client is informed & written consent given
- - insurer not subject to Insurance Act Reg's
- - claims payments may be more difficult
- - no AUTO insurance to be place with unlicensed insurer unless it's in excess than the minimum required
- - must file quarterly with the Superintendent of Insurance particulars of all insurance policies with unlicensed insurers
What investments can be purchased with Trust Funds?
- - marketable securities
- - stock certificates
- - bonds
- - debentures
- - treasury bills or other negotiable instruments
What is the minimum Equity Capitalization a member must maintain at all times?
- - $2500 sole proprietorship
- - $5000 partnership or corporation
How much Errors & Omissions insurance must a brokerage carry as a minimum?
How much Fidelity insurance (employee dishonesty coverage) must a member carry as a minimum?
Is it ok for a broker to make other arrangements about payment of the policy other than what is stated in the contract?
- - yes, if it is disclosed before the insurance is placed and is shown as a service fee
- - no undisclosed fees or charges
- - no rebating
A broker with a "restricted license" can do what?
- - deal with public
- - aid in obtaining insurance or reinsurance
- - provide risk management services
- - provide insurance consulting services
Can a broker pay a referral fee lead?
- refer to 991-15 - Misconduct item #12
List some points of the RIBO Code of Conduct.
- - be candid and honest
- - discharge duties with integrity
- - be conscientious, diligent and efficient
- - hold information given in confidence
- - take care of property entrusted to them by clients (policies)
- - no conflict of interest with other occupations
- - no undisclosed charges or fees to be made
- - encourage public respect for the insurance business
- - make services available to the public
- - maintain integrity of profession
What does RIBO Misconduct mean?
- - false advertising
- - unequal comparison of policies
- - monetary inducement to buy a policy
- - rebating
- - harassing prospective clients
- - carrying on business in a different name other than that registered under
- -conduct that results in unfair or delayed claims settlements
- - failing to comply with the RIB Act
- - acting as an insurance broker when not a broker
- - failing to meet code of conduct
- - any convictions under the Criminal Code or Insurance Act
Who and what is a principal broker?
- - individual who has the authority to act on behalf of the firm
- - complies with all RIBO requirements
- - designated may be held personally form the improper acts of the firm or employees
- - responsible to see that all trust accounts, books, records are maintained with reg's
TQ: As a broker holding a restricted license you are not able to:
- open and operate a trust account
TQ: Rules and agreements concerning binding of insurance coverage by brokers are:
- set and agreed upon between each insurance company and the broker office
TQ: When a new broker is issued a registration certificate restricted to acting under supervision, he may:
- deal directly with the public with regards to soliciting, negotiation, procuring or making of any contract or insurance on behalf of insurers
TQ: No insurer shall use a form of application, policy, endorsement or renewal or continuation certificate in respect to automobile insurance other than:
- a form approved by the Superintendent
TQ: A member who places insurance with an insurer unlicensed to trade insurance in Ontario must:
- obtain the written consent of the member of the public whom the broker services to the effect that they are aware their coverage will be carried by an unlicensed insurer in the province
TQ: An Insurance Broker:
- Acts in any manner in soliciting, negotiating, or procuring the making of any contract of insurance or reinsurance
TQ: The amount of Error and Omissions and Fidelity insurance every member must maintain is:
- $1,000,000 and $100,000
TQ: To provide education for broker members of the property casualty insurance industry is the purpose of which organization?
- IBAO: Insurance Brokers Association of Ontario
TQ: The Registered Insurance Brokers Act of Ontario requires an individual to be registered if they:
- On behalf of another negotiate an insurance contract and receive compensation
TQ: A real estate salesman in your city has arranged to pass you leads whenever he sells a home and in return he asks you to give him some premium consideration when his policy is up for renewal. You consult the RIBO Act and realize that:
- finders fees can be paid but only to persons who are registered as insurance intermediaries
TQ: When an insurance broker moves from a brokerage firm and begins working for a different firm, the individual must advise:
- RIBO within 30 days of the change
TQ: As per section 14.7 of regulation 991 (RIB Act), "a member shall not act as an insurance broker in accordance with the code of conduct"
- by jeopardizing the member's integrity, independence or competence
TQ: As an insurance broker "restricted to act under supervision"
- you may not act as a sole proprietor, control trust funds, or act as a designated individual
TQ: If you are employed as a general insurance broker, you are required to be RIBO licensed if you:
- discuss with the general public their insurance needs
TQ: Brokers may act in a manner that could be considered a conflict of interest if they:
- represent both the client and the insurer at the same time
TQ: Identify the Misconduct:
- the use of any practice or conduct that results in unreasonable or resistance to the fair adjustment of a claim
TQ: In which of the following situations would you be guilty of rebating?
- you have a quote from your insurance company for $1000. The competition quotes $750 and you decide you really want the business so you match the reduced premium and contribute $250 yourself
TQ: Rebating is?
- Charging an insured less than the premium shown on the policy
TQ: RIBO is which of the following:
- a self-regulatory body concerned with the operation of insurance brokers
TQ: Which is a function that is not the responsibility of RIBO?
- The protection of the interests of brokers in Ontario
Following registration as an insurance broker, an individual:
- must notify RIBO if any information on the original application form registration or renewal has become obsolete, including a change in employer, and file a notice correcting that information within 30 days of the change
Upon successful completion of the exam, you may qualify for registration as an insurance broker. If issued, the registration will be "restricted to acting under supervision." Which one (1) of the following most accurately describes the conditions under which you may act as an insurance broker under supervision?
- you may not act as a sole proprietor, nor be a "Principal Broker" as the term is used in the regulation, nor may you control trust funds
The RIBO Code of Conduct is stated in Ontario Regulation 991, Section 14. Three (3) of the following four (4) provisions are contained int he Code. Which is NOT:
- to maintain a Trust Account for all trust money received
An individual who acts or aids in any manner in soliciting, negotiating, or procuring the making of any contract of insurance is required to be registered an insurance broker if he:
- deals directly with the public and receives compensation
RIBO regulations stipulate that brokers must provide a policy or certificate of insurance to an insured within a certain period after insurance has been placed. What is the length of that period?
- 21 days
An Insurance Broker whose registration is restricted to acting under supervision may:
- solicit insurance from members of the public anywhere in Ontario
An individual is required to be registered as an insurance broker if he:
- for compensation, provides risk management and loss prevention services of behalf of another
The RIB Act grants to the Discipline Committee of RIBO power to impose penalties on members found guilty of misconduct, which is defined under Section 15(1) of Ontario Regulation 991. Which one (1) of the following is NOT defined as misconduct?
- Using an illustration, circulation or memorandum to represent the terms, benefits or advantages of any policy or contract of insurance
A fiduciary is:
- one who holds money or property in trust