2026 C130 Question Bank Free PDF Download Recently Updated Questions [Q16-Q38]

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2026 C130 Question Bank: Free PDF Download Recently Updated Questions

C130 Certification Exam Dumps with 79 Practice Test Questions

IIC C130 Exam Syllabus Topics:

Section	Objectives
Insurance Fundamentals and Risk Concepts	– Nature of risk (pure vs speculative risk) – Insurance principles and contract basics
Legal and Regulatory Framework	– Ethical standards and professional conduct – Law of agency and fiduciary duty
Insurance Products and Markets	– Property and casualty insurance basics – Commercial and personal lines overview
Insurance Distribution Systems	– Agent vs broker roles and responsibilities – Distribution models (independent agency, brokerage, direct writers)
Broker and Agent Practice Skills	– Client communication and advisory skills – Policy placement and insurer interaction

QUESTION 16
Chandeep, a broker with binding authority, sold property and liability coverage to his new client, Multiplex Movies. Three days into the policy term, there was a slip-and-fall incident. The liability loss was denied by the insurer. Multiplex Movies sues Chandeep for E & O. Which allegation will most likely be successful for the insured?

Failure to provide cover in time

Failure to issue a tangible policy

Failure to provide cover for exposures

Failure to explain the steps to take in the event of a claim

QUESTION 17
What should be considered when adding the increased cost-demolition or construction endorsement to an insurance policy?

The older the building, the more likely it is to deviate from current building codes.

Municipal building codes often require that owners update their property every 10 years.

It covers the requirement to bring existing structures up to code, even when the building remains unchanged.

Since the entire building has to be demolished to bring it up to code after a loss, the coverage increases the amount of insurance.

QUESTION 18
An underwriter receives a submission for a restaurant. The base rate is $0.80 per $100. Due to the client’s loss history, the underwriter decides on a $0.15 loading. What premium would the underwriter charge for a building valuation of $200,000?

$1,300

$1,600

$1,750

$1,900

QUESTION 19
Which statement about the expiry dates of binders is correct?

Binders must include the statement “valid for one year.”

The expiry date must automatically be 30 days from the effective date of the policy.

An open expiry date should be used in case the delivery of the formal policy is delayed.

To minimize the risk of overlooking an expiring binder, the expiry date should fall on a business day.

QUESTION 20
A client who wants coverage for a risk, independent from the risk a broker previously arranged coverage for, is usually required to submit which document?

Broker of record letter

Formal written application

Statement of change request

Insured’s authorization application

QUESTION 21
a) Describe the characteristics and exposures of a seasonal dwelling.
b) Describe the characteristics of a mobile home.

QUESTION 22
In law, what does the term prescription mean?

Committing to an automatic renewal process

Limited time after which a cause of action ceases

Guidelines relating to the acceptability of a class of risk

Transferring of the rights for action against the responsible party to the insurer

QUESTION 23
Michelle is a new agent who would like to protect herself against possible errors and omissions claims. What should Michelle practice in her interactions with clients and insurers?

Use close-ended questions with clients at all times

Recommend that clients consult with experts outside the insurance field if a situation calls for it

Offer advice to clients if she thinks it is beneficial, even if it is outside her area of expertise

Ensure all communication with clients and insurers is done face-to-face

QUESTION 24
Which locale is an example of an attractive nuisance?

Suburban street

Residential pool

Elementary school

Public flower garden

QUESTION 25
Which is an example of an indirect loss?

Arson at a retail store, initiated by an employee

Liability claim resulting from a slip and fall at a cinema

Loss of income following a fire claim that closes a factory

Water damage to an apartment when a frustrated tenant intentionally fails to turn off a tap

QUESTION 26
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?

Judgment notice

Statement of claim

Damages attestation

Statement of defence

QUESTION 27
Relay Cycle Shop has been non-operational for six months since an arsonist set fire to the building. The store is empty of all contents, and contractors continue to work onsite. The owner of the shop anticipates it will be able to reopen in four weeks. How would the shop traditionally be categorized by the insurer?

Idle

Vacant

Abandoned

Unoccupied

QUESTION 28
Brenda’s house is valued at $250,000. She has a policy coverage limit of $220,000 and an 80 percent coinsurance clause. What would be the payout if the insured suffers a loss of $150,000?

$120,000

$150,000

$176,000

$220,000

QUESTION 29
When closing a sale, what makes it easier for the intermediary to counter any objections raised by the client?

Employing passive listening

Adopting assertive body language

Being aware of what is happening in the industry

Using unusual and extremely serious claims examples

QUESTION 30
To protect themselves against claims that arise long after the policy expiration date, a broker should retain a permanent copy of which policy?

Crime

Liability

Property

Automobile

QUESTION 31
Which item would be insured under a personal articles floater?

Antique table

Leather sofa

Coffee machine

Stamp collection

QUESTION 32
An insured reports a loss to their broker and is subsequently contacted by an adjuster to discuss the claim. A few days later, the insured calls their broker to ask a question about their claim settlement. What is the best course of action for the broker to take?

Review the policy wordings with the insured

Advise the insured to contact the ombudsperson

Provide expected settlement values to the insured

Connect the insured with their loss adjuster to discuss the claim

QUESTION 33
In insurance sales terminology, what is a lead?

A broker who aims to meet their clients’ needs with products

A segment of existing clients who have similar insurance coverage needs

An insurer with an underwriting policy that most closely aligns with a broker’s requirements

A member of a group of potential clients that fits the profile that has been determined as the marketing target

QUESTION 34
Jim owns a metal factory. Which question should Jim’s broker ask to best understand the commercial occupancy of the company?

What is the total number of your staff?

How is your factory protected against fire?

What does a typical day look like in your factory?

Is your factory left unattended for long periods of time?

QUESTION 35
When does a minimum retained premium apply to a policy?

When the insured cancels the policy midterm

When the insurer cancels the policy at any time

When the policy has been voided for misrepresentation

When the insured moves the policy at renewal to another insurer

QUESTION 36
John, a broker, has binding authority for comprehensive homeowners policies up to $200,000. On Saturday morning, a potential client calls John and advises that she is at the lawyer’s office signing the purchasing documents for a $500,000 home and requires comprehensive homeowners coverage immediately. What action should John take?

Provide coverage on a named-perils basis

State that he will try to arrange coverage with the insurer on Monday morning

Issue a cover note providing a comprehensive homeowners policy with a policy limit of $500,000

Inspect the home and, if the risk is acceptable, issue a comprehensive homeowners policy with a limit of $500,000

QUESTION 37
What do statutory conditions and general conditions have in common?

Apply to all types of insurance

Considered fine print wordings

Designed to protect the insured

Are countersigned by an executive of the insured

QUESTION 38
Briefly discuss the liability exposures that arise from the ownership of animals.