CAIB 1 — CAIB New Edition 1.0 Exam Blueprint

How to Use This Exam Blueprint

This checklist is an independent study aid for candidates preparing for the Insurance Brokers Association of Canada exam CAIB New Edition 1.0 - CAIB 1, exam code CAIB 1.

Use it as a practical readiness map:

1. Read each topic area.
2. Mark whether you can explain it, apply it to a client scenario, and identify the broker action required.
3. Revisit weak areas with your course materials, provincial guidance, policy wordings, and practice questions.
4. During final review, focus less on memorizing isolated terms and more on applying insurance concepts to client facts.

Because exact official exam weights are not provided here, the sections below are presented as readiness areas, not weighted exam sections.

Topic-Area Readiness Table

Core Insurance Principles Checklist

Be able to explain each principle in plain language and apply it to a scenario.

Insurance Contract and Policy Wording Readiness

Can You Identify the Parts of a Policy?

• Declarations page: named insured, location, limits, deductibles, policy period, coverages.
• Insuring agreement: what the insurer agrees to cover.
• Definitions: words with specific policy meanings.
• Conditions: duties, rules, and procedures that affect coverage or claims.
• Exclusions: losses, property, people, activities, or causes not covered.
• Endorsements: amendments that add, remove, or modify coverage.
• Statutory or mandated conditions where relevant to the jurisdiction.
• Schedule of coverages or special limits where applicable.
• Cancellation, non-renewal, and change provisions.

Contract Formation and Validity Checks

Risk, Perils, and Hazards

Know the Distinctions

Can You Do This?

• Given a short description, identify the peril causing the loss.
• Separate the peril from the resulting damage.
• Identify at least one physical, moral, and morale hazard.
• Explain why some risks are insurable and others are not.
• Recommend a basic risk management technique: avoid, reduce, retain, transfer, or share.
• Explain how insurance transfers financial consequences but does not remove the underlying hazard.

Broker Role, Client Needs, and Professional Conduct

For CAIB 1, be ready to think like a broker: collect facts, identify exposures, explain options, document advice, and avoid misleading the client.

Broker Action Checklist

• Ask enough questions before recommending coverage.
• Do not assume the prior policy still matches the client’s current risk.
• Confirm material changes in writing where appropriate.
• Explain important limitations in plain language.
• Document advice, client decisions, and declined coverages.
• Avoid guaranteeing claim outcomes.
• Distinguish insurer authority from broker responsibilities.
• Escalate uncertain coverage or compliance issues.
• Preserve confidentiality of client information.
• Address conflicts of interest transparently.

Underwriting Basics

Information the Broker Should Be Ready to Gather

Underwriting Decision Prompts

Ask yourself:

• Is the risk accurately described?
• Is any information missing or inconsistent?
• Is there a material change from the prior term?
• Is the requested coverage appropriate for the exposure?
• Is the risk acceptable as presented, acceptable with conditions, or likely unacceptable?
• Is additional documentation needed before coverage is bound?
• Does the client understand any conditions, exclusions, or limitations?

Property Insurance Concepts

Property Coverage Readiness Table

Cause-of-Loss Analysis

When reviewing a property scenario, work through this order:

1. What property was damaged?
2. Who owns it?
3. Where was it located?
4. What caused the loss?
5. Is the cause a covered peril or not excluded?
6. Is the property type covered?
7. Are there special limits, deductibles, or conditions?
8. Did the insured meet duties after loss?
9. Is valuation actual cash value, replacement cost, or another basis?
10. Is another policy or party involved?

Habitational Insurance Readiness

Be ready to distinguish common personal property and liability needs for homeowners, tenants, condominium unit owners, seasonal dwellings, and other living arrangements.

Habitational Coverage Checklist

• Dwelling building coverage is adequate for the property type.
• Detached private structures are identified.
• Personal property limits and special limits are reviewed.
• Additional living expense or loss of use is understood.
• Personal liability coverage is reviewed.
• Voluntary medical payments or voluntary property damage concepts are understood where applicable.
• Sewer backup, water damage, earthquake, or other optional coverages are reviewed where relevant.
• High-value property is scheduled or specifically discussed if needed.
• Occupancy, vacancy, rental, and business-use questions are answered accurately.
• Endorsements are reviewed for additions or restrictions.

Personal Property and Special Limits

Items That Often Need Extra Attention

Personal Liability Readiness

Liability Analysis Framework

Use this sequence for personal liability scenarios:

1. Did someone allege bodily injury or property damage?
2. Is the insured legally responsible or potentially responsible?
3. Did the incident arise from personal activities, premises ownership, vehicle use, business activity, or another exposure?
4. Is the person an insured under the policy?
5. Is the location or activity within the policy’s scope?
6. Does an exclusion apply?
7. Are defence costs addressed separately from damages?
8. Are there voluntary payment or medical payment provisions that may apply without legal liability?
9. Is another policy more appropriate?

Common Personal Liability Exam Cues

Automobile Insurance Readiness

Auto insurance is highly jurisdiction-dependent in Canada. For CAIB 1, be prepared to apply general personal auto concepts and then reconcile details with the province-specific materials you are using.

Auto Fact-Finding Checklist

• Who owns or leases the vehicle?
• Who is the principal operator?
• Who else drives it?
• Where is it garaged or primarily kept?
• What is the vehicle used for: pleasure, commute, business, delivery, rideshare, or other use?
• What is the annual or typical distance driven?
• Are there young, newly licensed, occasional, or excluded drivers?
• Are there prior accidents, claims, convictions, suspensions, or cancellations?
• Is the vehicle financed or leased?
• Are optional physical damage coverages needed?
• Are deductibles appropriate?
• Are there modifications, custom equipment, or special vehicle uses?
• Has coverage been bound before the vehicle is driven?

Auto Coverage Concepts to Review

Claims Handling and Duties After Loss

Claims Process Readiness Table

Duties After Loss Checklist

• Give prompt notice.
• Protect property from further damage.
• Separate damaged and undamaged property where practical.
• Keep receipts for emergency repairs or additional expenses.
• Provide inventory and proof of value.
• Cooperate with insurer investigation.
• Do not dispose of damaged property prematurely if inspection is needed.
• Do not admit liability or make unauthorized settlements.
• Report theft, vandalism, or certain losses to authorities where required.
• Review settlement basis before advising the client.

Documentation, Binding, Endorsements, and Renewals

File Documentation Checklist

Binding and Change Decision Points

Ethics, Compliance, and Professional Judgment

Professional Conduct Scenarios

Red-Flag Behaviours

• Backdating coverage.
• Misstating occupancy, use, claims history, or driver information.
• Binding without authority.
• Failing to disclose material exclusions.
• Treating client silence as informed consent.
• Relying on memory instead of file notes.
• Promising claim payment.
• Ignoring material changes.
• Sharing confidential information improperly.
• Failing to follow up on time-sensitive requests.

Common Weak Areas and Exam Traps

Scenario Decision Checks

Scenario 1: Home-Based Business

A client works from home, stores inventory in a spare room, and occasionally has customers visit.

Can you identify?

• Why this is more than ordinary residential occupancy.
• What property exposure may be limited or excluded.
• What liability exposure may exist.
• What questions the broker should ask.
• Whether a personal policy endorsement or separate business coverage should be discussed.
• What should be documented if the client declines additional coverage.

Scenario 2: Water Damage While Away

A homeowner returns from vacation to find water damage.

Can you identify?

• The source of water.
• Whether the home was vacant or merely unoccupied.
• Whether heat, water shutoff, inspection, or maintenance conditions may matter.
• Whether damage is sudden and accidental or gradual.
• Whether additional living expense may apply.
• Why the broker should avoid promising coverage before policy review.

Scenario 3: Newly Licensed Driver

A client’s teenage child has obtained a licence and sometimes drives the family vehicle.

Can you identify?

• Why this is material to underwriting.
• Whether the driver must be disclosed.
• How driver status may affect premium or eligibility.
• Why omission can affect claim handling.
• What documentation the broker should keep.

Scenario 4: Condominium Loss Assessment

A condominium corporation charges unit owners after damage to common property.

Can you identify?

• Difference between unit owner property and condominium corporation property.
• Why loss assessment coverage may matter.
• Whether deductible assessment coverage may be relevant.
• Why the condominium corporation’s policy does not replace the unit owner’s policy.
• What documents the broker may need to review.

Scenario 5: Client Requests Backdated Coverage

A client forgot to renew and asks the broker to make coverage effective last week.

Can you identify?

• Why backdating is improper.
• What should be explained to the client.
• What the broker can and cannot do.
• Why accurate effective dates matter.
• What should be documented.

Calculation and Interpretation Checks

CAIB 1 readiness is often more about interpretation than heavy calculation, but you should be comfortable with basic insurance math.

Deductible Application

Know how to apply a deductible to a covered loss.

\[ \text{Claim payment} = \text{covered loss amount} - \text{deductible} \]

Readiness prompts:

• Can you calculate the insured’s out-of-pocket portion?
• Can you explain why the deductible applies only after determining covered loss?
• Can you identify when a deductible applies per occurrence rather than per item, if wording says so?
• Can you avoid applying a deductible to an excluded loss?

Actual Cash Value Concept

Actual cash value is commonly understood as replacement cost less depreciation, subject to policy wording and jurisdictional interpretation.

\[ \text{Actual cash value} = \text{replacement cost} - \text{depreciation} \]

Readiness prompts:

• Can you explain depreciation in plain language?
• Can you distinguish ACV from replacement cost?
• Can you identify why age, condition, and useful life may matter?
• Can you explain why the client may not receive the full cost of a new item under ACV settlement?

Limit, Sublimit, and Special Limit Thinking

“Can You Do This?” Master Checklist

Use this as a final self-test before exam day.

Fundamentals

• Define risk, peril, and hazard without mixing them up.
• Explain pure risk versus speculative risk.
• Identify physical, moral, and morale hazards.
• Explain indemnity and why insurance is not meant to create profit.
• Apply insurable interest to property and auto scenarios.
• Identify material facts in an application.
• Explain subrogation and contribution.
• Identify proximate cause in a simple loss chain.
• Explain the purpose of deductibles and limits.
• Distinguish exclusions from conditions.

Policy Analysis

• Locate answers in declarations, definitions, insuring agreements, exclusions, conditions, and endorsements.
• Determine whether a person qualifies as an insured.
• Determine whether property qualifies as insured property.
• Determine whether the location is covered.
• Determine whether the peril is covered.
• Identify special limits.
• Identify duties after loss.
• Explain replacement cost versus actual cash value.
• Recognize when more facts are needed before a coverage answer can be given.
• Avoid assuming broad coverage where wording is limited.

Broker Practice

• Conduct a basic personal-lines needs analysis.
• Ask follow-up questions when client facts change.
• Identify material changes during a policy term.
• Document client instructions accurately.
• Explain exclusions and limitations clearly.
• Confirm coverage changes and effective dates.
• Escalate uncertain coverage or binding questions.
• Maintain confidentiality.
• Avoid unauthorized promises.
• Handle declined coverage professionally.

Habitational Insurance

• Match homeowner, tenant, condominium, rental, and seasonal exposures to coverage needs.
• Identify building, contents, detached structures, additional living expense, and liability exposures.
• Spot high-value personal property concerns.
• Recognize vacancy, unoccupancy, renovation, and rental red flags.
• Identify water, sewer, earthquake, theft, and other optional coverage discussions where relevant.
• Explain why landlord, tenant, and condominium corporation policies cover different interests.
• Identify personal liability exposures at the premises.
• Recognize when business activity changes the risk.
• Explain why endorsements may be needed.
• Document client decisions about optional coverages.

Automobile Insurance

• Identify owner, principal operator, occasional drivers, and vehicle use.
• Distinguish liability, accident benefits concepts, and physical damage coverages.
• Explain collision, comprehensive, specified perils, and all perils concepts.
• Identify why business use, delivery, or rideshare activity is material.
• Recognize young or newly licensed driver disclosure issues.
• Explain deductibles and optional endorsements.
• Identify leasing or financing interests.
• Recognize non-owned automobile exposures.
• Avoid assuming rules are identical across provinces.
• Confirm that coverage is bound before the vehicle is used.

Claims

• Tell the insured to report promptly.
• Identify duties to protect property from further damage.
• Explain proof of loss and documentation needs.
• Avoid guaranteeing claim payment.
• Identify salvage and subrogation issues.
• Explain settlement basis.
• Recognize liability claim reporting concerns.
• Identify when a police report or authority report may be relevant.
• Explain why coverage depends on facts and wording.
• Document claim-related communications.

Final-Week Review Plan

Final Review: Fast Triage Questions

Before answering a scenario, ask:

1. Who is the insured?
2. What property, vehicle, person, or liability exposure is involved?
3. What happened?
4. When did it happen relative to the policy period or binding request?
5. Where did it happen?
6. What policy section or coverage might respond?
7. What exclusion, condition, limit, or deductible might apply?
8. What material fact was disclosed, omitted, or changed?
9. What should the broker do next?
10. What must be documented?

Practical Next Step

After reviewing this checklist, complete a mixed set of CAIB 1-style practice questions under timed conditions. For every missed question, classify the miss as one of these: terminology, policy wording, broker judgment, underwriting fact, claims process, auto concept, habitational coverage, or ethics/documentation. Then revisit the matching section above before your next practice set.