LLQP Accident & Sickness · Component 1.2 · 35% of the exam
A client has individual DI purchased ten years ago based on her income at that time. Her income has doubled since. The review should note:
- AThe benefit keeps pace automatically because DI policies index to reported income at each anniversary
- BThe gap can be ignored because income growth is not a review item
- The benefit now replaces far less income; FPO or a new application can raise it
- DThe policy is void because insurable income has changed materially since issue
Correct answer: C) The benefit now replaces far less income; FPO or a new application can raise it
DI benefits are fixed unless increased. Income growth erodes replacement ratios. The FPO rider allows increases without medical evidence; otherwise a new application is needed.
Why the other options are wrong
- ABenefits do not adjust automatically without a rider or a new application.
- BA benefit that no longer matches income is the most material review finding.
- DThe policy remains valid; only its adequacy has changed.
Exam tip
Review DI benefit against current income at every review; use FPO where available.
Common mistake
Assuming a DI benefit bought years ago still fits.
What this tests
CISRO competency component 1.2 — 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 asks why the agent wants to know how assets are owned (jointly or individually). In the A&S context the answer is:
- 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?
Practice the whole Accident & Sickness module
Timed sets weighted like the exam, and review of every question you miss. Free to start.