TICO MODULE 5 EXAM QUESTIONS WITH VERIFIED ANSWERS LATEST UPDATE 2026

TICO MODULE 5 EXAM QUESTIONS WITH VERIFIED ANSWERS LATEST UPDATE 2026 Section 52 of the Regulation - Answers Purpose of the travel Industry compensation Fund The purpose of the Travel Industry Compensation Fund (usually referred to simply as the Compensation Fund, or the Fund) is to : - Answers protect consumers who purchase travel services from Ontario-registered retailers. If travel services cannot be provided because of the financial failure of a registrant or an airline or cruise line end supplier, then a consumer may be eligible to: - Answers receive compensation from the Fund. True or False: Consumers do not have to live in Ontario to be covered by the Fund. - Answers True. As long as consumers purchase travel services from an Ontario registered travel agency, they are protected by the Compensation Fund in the event that they do not receive their travel services as a result of the failure of an Ontario registered travel retailer, an Ontario registered travel wholesaler or an airline or cruise line. The Fund is made up of: - Answers contributions made by registrants any money borrowed under this or an earlier Regulation recoveries of money paid from the Fund; and income earned on the money in the Fund. Section 72 of the Regulation - Answers TICO has the legal right to borrow money to supplement the Fund. Section 70 of the Regulation - Answers A registrant is required to reimburse the Fund for any claims paid to the registrant's customers under certain circumstances A registrant is required to reimburse the Fund for any claims paid to the registrant's customers under the following circumstances: - Answers the registrant is bankrupt or insolvent or has ceased to carry on business; or the registrant purchased travel services on the customer's behalf, extending credit to the customer, and the customer paid the registrant for the travel services after the supplier of the travel services had become bankrupt or insolvent or ceased to carry on business. claimant - Answers someone who officially makes a claim to a benefit or right. In the case of the Travel Industry Compensa-tion Fund, they are someone who wishes to be paid back ("reimbursed") for what he or she spent on a travel service but did not receive or someone who wish-es to be reimbursed for rea-sonable expenses incurred to complete a trip. A travel agent or travel wholesaler must contribute to the: - Answers Travel Industry Compensation Fund. Contributions to the Fund must be made : - Answers twice a year (at a six-month interval), with each payment based on the company's gross sales in Ontario. When registrants make payments to the Fund, each payment must be accompanied by : - Answers a completed return that shows the registrant's sales in Ontario for the preceding fiscal half-year and the amount owing to TICO. Registrant returns must be: - Answers certified for accuracy by the registrant or an authorized officer or partner of the registrant. Standard Claim - Answers is a claim for travel services that were paid for but not provided as a result of the failure of an Ontario-registered travel agent, an Ontario-registered travel wholesaler or an airline or cruise line. Who can make a standard claim? - Answers A customer, a travel agent or a travel wholesaler Trip Completion Expense Claim - Answers claim for reason-able expenses incurred to complete a trip where a customer or another person has begun a trip that cannot be com-pleted because travel services have not been provided as the result of the failure of a TICO registrant. Who can make a trip completion expense claim - Answers A customer or a travel agent Section 56 of the Regulation - Answers The TICO Board of Directors is responsible for determining whether all or part of a claim is eligible for reimbursement. The Board is also responsible for deciding on the eligible amount of a claim. Section 72 of the Regulation, Administration of the compensation Fund - Answers TICO may borrow money to supplement the Compensation Fund. If the Fund has more money than what it needs to meet TICO's immediate needs, TICO can invest funds in authorized investments Section 74 of the Regulation - Answers TICO's Board of Directors may retain the services of experts or advisors, such as legal counsel, accountants, staff, or trade associations, to: administer and manage the Fund; investigate claims; and maintain and protect the Fund. The Fund may be used to pay these individuals for their services. Section 73 of the Regulation - Answers To ensure that the Fund is properly managed, the Director can request from the Fund administrators any information, books, records, or documents related to the Fund. Section 75 of the Regulation - Answers The Director can also request an audit of the affairs of the Fund. If that happens, the TICO Board must assist the auditors and provide any information they require The Tribunal has the power to either: - Answers allow the claim in whole or in part and direct TICO to pay the amount allowed from the Fund; or deny the claim in whole or in part. Claimants who wish to appeal a Board decision are entitled to a hearing before the Tribunal as long as they mail or deliver a written request to the Registrar and the Tribunal within : - Answers 15 days after being informed that their claim was denied. If a claimant does not request a hearing: - Answers the decision of the TICO Board becomes final. If a claimant does request a hearing: - Answers the Tribunal will select a date and hold the hearing. The parties required to be involved at the hearing are the : - Answers claimant, TICO, and any other person specified by the Tribunal. Section 71 of the Regulation - Answers Appeals Process The TICO Board must immediately notify the claimant in writing if - Answers it decides that a claim or any part of it is not eligible for reimbursement. The Board must also tell the claimant that he or she has the right to a hearing before the Licence Appeal Tribunal, and how and when to request a hearing. Section 62 of the Regulation - Answers Subrogation section of the claim form Subrogation - Answers is a legal term. It describes a situation in which one claimant is substituted by another claimant who takes on the legal rights and claims of the original person. For example, imagine that Amy is owed $100 by John. If Duncan steps in and pays Amy the $100 on John's behalf, then John now owes Duncan the money - and Duncan has the legal right to collect it from John. If the TICO Board determines that all or part of a claim is eligible, the Board can require a claimant to transfer to TICO - Answers his or her interest in a claim against a third party (for example, a registrant who has defaulted). To put this subrogation into effect, the claimant must sign any documents necessary to make the transfer legal. TICO may then reimburse the claimant from the Compensation Fund and try to recover the funds from the third party. A standard claim must be made to the Board of Directors within - Answers 6 months of the reg-istrant or end supplier failure. A trip completion expense claim must be made to the Board of Directors within - Answers three months after the registrant be-comes bankrupt or insolvent or ceases to carry on business. Additional information requirement - Answers If a claim is received incomplete, the TICO Board may ask the claimant to provide additional information or documentation to prove his or her claim. In such cases, the claimant has 12 months from receiving the request to provide the details. If a claimant does not do so, TICO will consider the claim "abandoned." Depending on the circumstances, TICO may give a claimant additional time to provide the requested details Affidavit requirement - Answers Claimants are required to complete this in support of their claim. affidavit - Answers legal written document that a claimant must swear or affirm is true, in front of a commis-sioner of oaths, a notary public, or a lawyer. A travel agent shall, twice a year, make payments in the amount that is the greater of the following: - Answers $25 plus the applicable taxes. A travel wholesaler shall, twice a year, make payments in the amount that is the greater of the following: - Answers $25 plus the applicable taxes. A travel agent shall, twice a year, make payments in the amount that is the greater of the following, and The amount of, - Answers $0.15 plus the applicable taxes for every $1,000 or part of $1,000 of sales in Ontario made on or after May 1, 2013. A travel wholesaler shall, twice a year, make payments in the amount that is the greater of the following, and The amount of, - Answers $0.15 plus the applicable taxes for every $1,000 or part of $1,000 of sales in Ontario made on or after May 1, 2013. Contributions required under this Payment Schedule shall be made to TICO: - Answers within 90 days after the end of the first half of the registrant's fiscal year; and within 90 days after the end of the second half of the registrant's fiscal year. Payments shall be accompanied by a: - Answers completed return in a form approved by the Registrar indicating the registrant's sales in Ontario for the preceding fiscal half-year and the amount of payments owing to the administrative authority. he return shall be certified, as to the accuracy of the information contained in it, by the: - Answers registrant or an authorized officer or partner of the registrant. Effective May 1, 2013, this Schedule replaces all previous Compensation Fund Contribution Rate Payment Schedules. Any required registrant payments that were owed under a previous Payment Schedule and which have not been paid prior to the effective date of this Payment Schedule: - Answers continue to remain due and owing to TICO. Section 57 of the Regulation - Answers Consumers who have booked and paid for travel services through a registered travel agent may make a claim against the Fund. A consumer whose booking was not made through a registered travel agent is not: - Answers eligible to make a claim. Claims can only be made against the Fund for the non-provision of travel services for two reasons: - Answers the bankruptcy or insolvency of a registrant; or the failure of an airline or cruise line end supplier. Before allowing a claim, TICO may ask claimants to provide - Answers proof that they have not been reimbursed by other parties. The intent here is to ensure that consumers do not "double dip" - that is, receive compensation twice for the same claim. Standard claims are based on the cost of the - Answers original travel services purchased, not on the cost of alternate or replacement travel services. The Fund will not reimburse consumers for any of the following claims: - Answers Any alternative or replacement travel purchased, Travel services that were not provided because an end supplier(other than an airline or cruise line) declared bankruptcy or became insolvent or ceased to carry on business. This could include an out-of-province wholesaler. Travel services or alternative services that were provided. Travel services that were available but were not received be-cause of an act or failure to act on the part of the customer or another person for whom the travel services were purchased. For example, the person decided not to stay in the hotel that was booked, or the person chose to cancel the reservation, which was 100% non-refundable. Counselling fees paid to a travel agent. Travel services that were to be received as a prize, award, or goodwill gesture. Travel services that the customer obtained with a voucher, certificate, coupon, or similar document that the customer did not pay for. Travel services that the customer did not pay for with cash or by a cheque, credit card, or other similar payment method. Insurance premiums. A claim that is based on the cost, value, or quality of the travel services or alternative travel services. A claim in connection with travel services provided to enable immediate departure or trip completion. Consequential or indirect damages incurred as a result of the failure to provide the travel services. Before making a claim against the Fund, a consumer must first seek payment from any other person or company that may be legally obligated to : - Answers reimburse or compensate them (for example, an insurance company or a credit card company). In other words, consumers are eligible to make a claim only if no other party has reimbursed them. Section 58 of the Regulation - Answers Travel agents The Fund will not reimburse travel agents for any of the following claims: - Answers any commission; and any remuneration, such as a service charge, owing on the travel services purchased by the customer. A travel agent can make a claim on the Compensation Fund if the following requirements are met: - Answers The customer must have booked and paid for the travel ser-vices through an Ontario-registered travel agency. The travel agent must have dealt with a registered travel whole-saler, an airline or cruise line in good faith and at arm's length. The travel agent must have passed all or part of the customer's money to the travel wholesaler, airline, or cruise line The travel agent has either: refunded the customer , provided alternative travel services for the customer because the original services were not provided because of a registrant or airline or cruise line failure. It is clear that the customer would have an eligible claim against the Compensation Fund. If the travel agent is still holding any of the customer's money, the travel agency is responsible for: - Answers refunding that money to the customer If the travel agent has provided alternative travel services for the customer because the original services were not provided because of a registrant or airline or cruise line failure. This condition does not apply if the travel agent : - Answers has acquired the rights to the travel services for resale A travel wholesaler can make a claim on the Compensation Fund for money it has paid out to: - Answers reimburse a customer for travel services paid for but not provided; or provide the customer with travel services for which the travel wholesaler has not been paid by the travel agent. A travel wholesaler can make a claim on the Compensation Fund for money it has paid out, However, such a claim applies only if: - Answers the travel agent is a registrant; the travel wholesaler dealt with the travel agent in good faith and at arm's length; the travel agent failed to pass all or part of the customer's money to the travel wholesaler; the travel wholesaler has had no previous dealings with the travel agent in which the travel agent failed to pass the customer's money to the travel wholesaler (or defaulted in another way); the travel wholesaler has taken reasonable measures to ensure that the travel agent is reliable and financially responsible; and the travel agent received the customer's money and it is clear that the customer would otherwise have had a claim against the Fund. The Fund will not reimburse travel wholesalers for any of the following claims: - Answers Any amount owing from a travel agent that represents a commission or other remuneration (including a travel service charge). A payment made by credit card if the registrant who processed the payment did not first re-ceive approval for the payment from the customer and from the card issuer (in keeping with the agreement between the cardholder and the registrant).