Registered Insurance Brokers of Ontario (RIBO) Practice Exam

When entering a contract with the insurance company, what is something the broker is NOT authorized to do?

1. Negotiate policy limits

2. Be registered as an insurance agent

3. Provide quotes to clients

4. Issue renewals for existing policies

The correct answer is: Be registered as an insurance agent

The correct choice indicates that being registered as an insurance agent is something the broker is not authorized to do when entering into a contract with the insurance company. Brokers operate under a different capacity compared to agents. They represent the client and facilitate the purchase of insurance on behalf of the clients, not the insurance companies. The function of a broker is primarily to connect clients with various insurance options available in the market based on their needs. Unlike insurance agents, who have a contractual relationship with specific insurance companies and work primarily for those companies, brokers must act in the best interests of their clients, often placing them in a position to offer multiple quotes and policies from various providers. This distinction underscores the independence of brokers, who don't represent a single insurance company's interests. Their role is focused on advocating for their clients rather than being formal representatives of the insurance companies themselves. Other options involve activities that brokers are indeed authorized to perform. They can negotiate policy limits, provide quotes to clients, and issue renewals for existing policies, all of which are essential functions of a broker in the insurance transaction process.