IBABC CAIB-3 Exam Questions : Canadian Accredited Insurance Broker (CAIB 3) Exam

  • Exam Code: CAIB-3
  • Exam Name: Canadian Accredited Insurance Broker (CAIB 3) Exam
  • Updated: Sep 18, 2026
  • Q&As: 48 Questions and Answers

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IBABC CAIB-3 Exam Syllabus Topics:

SectionObjectives
Topic 1: Crime Insurance
Topic 2: Directors' and Officers' Liability Insurance
Topic 3: Reinsurance
Topic 4: Aviation Insurance
Topic 5: Surety Bonding
Topic 6: Marine Insurance
Topic 7: Cyber Insurance
Topic 8: Risk Assessment for Advanced Commercial Risks
Topic 9: Business Interruption Insurance

IBABC Canadian Accredited Insurance Broker (CAIB 3) Sample Questions:

Question #1

DEFINE: FRAUD (1 mark)

Reveal Solution  Discussion  0

Correct Answer:

See the answer in Explanation below.
Explanation:
Fraud is an intentional act of deception, misrepresentation or dishonesty used to obtain money, property or another benefit, or to cause another person a financial loss.
Reference: CAIB 3 Training & Study Pack - Crime Insurance: fraud and dishonest acts.

Question #2

Not everyone can qualify for a surety bond.
A) Identify the three (3) criteria which form the basis of the credit approval of every applicant for bonding. (1
1/2 marks)
B) Identify one (1) factor under each of the criteria stated above which the surety company would consider. (1
1/2 marks)
(3 marks)

Reveal Solution  Discussion  0

Correct Answer:

See the answer in Explanation below.
Explanation:
A) The three criteria are Character, Capacity and Capital.
B) One factor under each is:
- Character: honesty, reputation and past record.
- Capacity: experience and ability to complete the work.
- Capital: financial strength and available working capital.
Reference: IBAC CAIB 3 Student Resource Guide (2013), Chapter 5 - Qualifying for a Surety Bond:
Character, Capacity and Capital.

Question #3

DEFINE: CEDENT (1 mark)

Reveal Solution  Discussion  0

Correct Answer:

See the answer in Explanation below.
Explanation:
A cedent, or ceding company, is the insurer or reinsurer that transfers part of a risk to another reinsurer.
Reference: CAIB 3 Training & Study Pack - Reinsurance: cedent/ceding company terminology.

Question #4

DEFINE: SURETY (1 mark)

Reveal Solution  Discussion  0

Correct Answer:

See the answer in Explanation below.
Explanation:
The surety is the party that guarantees the principal will fulfill an obligation to the obligee. If the principal defaults, the surety may have to perform or pay according to the bond.
Reference: IBAC CAIB 3 Student Resource Guide (2013), Chapter 5 - Surety Bonds: principal, obligee and surety.

Question #5

From a risk management perspective, every loss exposure has three dimensions. What are the three (3) dimensions? (1 mark)

  • A. Estimated frequency, estimated severity, probability of recovery.
  • B. Type of value exposed, peril causing loss, extent of potential resulting financial consequences.
  • C. Peril exposed, estimated frequency, estimated severity.
  • D. Property exposed, latency period, probability of loss.
Reveal Solution  Discussion  0

Correct Answer: B  🗳️

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