LLQP Accident & Sickness · Component 3.1 · 25% of the exam
A business owner applying for DI is usually asked for:
- AA list of major customers and contracts, to confirm that the business is likely to keep operating
- BA recent pay stub only, since the owner's salary is the only insurable income from the business
- Personal tax returns and the business's financial statements for the past two years
- DA business plan and marketing budget, to confirm that the owner's income is likely to grow
Correct answer: C) Personal tax returns and the business's financial statements for the past two years
Owner income mixes salary, dividends and retained earnings. Insurers use corporate statements to determine insurable earned income, often adding back certain expenses.
Why the other options are wrong
- ACustomer lists are irrelevant to insurable income.
- BPay stubs do not capture business income.
- DBusiness plans are not income evidence.
Exam tip
Business owners: two years personal + corporate financials.
Common mistake
Submitting a business owner's DI application without corporate financials.
What this tests
CISRO competency component 3.1 — Implement a recommendation adapted to the client's needs and situation — which is weighted at 25% of the Accident & Sickness module. Written against the published curriculum.
More from component 3
- An underwriter assigns a disability applicant to occupational class 2 rather than class 4. The practical effect is that:
- A disability applicant discloses a back condition that resolved four years ago with no recurrence. The likely underwriting outcome is:
- Financial underwriting for an individual disability application exists to:
- A critical illness applicant's mother and sister both had breast cancer before fifty. The underwriter is likely to:
- An applicant for long-term care coverage is seventy-two. The insurer is most likely to require:
- Group long-term disability coverage within the non-evidence maximum is issued without individual medical questions because:
Practice the whole Accident & Sickness module
Timed sets weighted like the exam, and review of every question you miss. Free to start.