LLQP Accident & Sickness · Component 1.1 · 35% of the exam
A client asks why the agent wants to know how assets are owned (jointly or individually). In the A&S context the answer is:
- ATo decide whether a joint life policy would be cheaper than two single policies for the same amount of coverage
- Ownership affects which assets could be liquidated to fund care, and the tax cost
- CBecause jointly owned assets are treated as unearned income by the insurer
- DBecause occupational class depends partly on the size of the client's asset base
Correct answer: B) Ownership affects which assets could be liquidated to fund care, and the tax cost
The curriculum lists types of ownership of assets and tax consequences related to liquidation. Self-funding a disability by selling assets can be costly; insurance avoids it.
Why the other options are wrong
- ALife policy structure is a life insurance question, not an A&S fact-finding one.
- COwnership does not turn an asset into income.
- DOccupation class comes from duties and hazards, not assets.
Exam tip
Assets are a resource only if they can be liquidated without severe tax or loss.
Common mistake
Counting illiquid assets as if they could fund a disability.
What this tests
CISRO competency component 1.1 — Assess the client's needs and situation — which is weighted at 35% of the Accident & Sickness module. Written against the published curriculum.
More from component 1
- The single most important fact for sizing a client's disability income need is:
- A client's beneficiaries for assets are listed in the fact-finding. Why does this matter for A&S planning?
- A client mentions a back injury five years ago that fully resolved. The agent should:
- Which element of a client's situation most affects the definition of disability that should be recommended?
- Which of the following health facts is most relevant to a client's disability insurance situation?
- Why does the disability needs analysis ask about the client's participation in employer-sponsored savings plans?
Practice the whole Accident & Sickness module
Timed sets weighted like the exam, and review of every question you miss. Free to start.