LLQP Accident & Sickness · Component 1.3 · 35% of the exam
A client is diagnosed with a serious illness but recovers within a year and returns to work. During that year she had extra medical, travel and child-care costs and a spouse who took unpaid leave. This scenario illustrates the need for:
- Critical illness insurance, a lump sum for the costs and lost family income
- BA deferred annuity that can be surrendered without penalty to cover the family's extra costs
- CLife insurance with an accelerated benefit payable on diagnosis of a serious illness
- DTravel medical insurance, since treatment away from home drove most of the costs
Correct answer: A) Critical illness insurance, a lump sum for the costs and lost family income
CI addresses costs and disruptions of a serious illness that DI does not: the spouse's lost income, treatment abroad, home modifications, and simply time to recover. The curriculum lists risks with financial impact for the client's family.
Why the other options are wrong
- BAnnuities are retirement income vehicles, not illness protection.
- CShe survived; a life policy's accelerated benefit is for terminal diagnoses.
- DTravel insurance covers emergencies away from home, not treatment costs and a spouse's leave.
Exam tip
CI need = the costs and choices a serious illness creates that income replacement does not cover.
Common mistake
Assuming DI makes CI redundant.
What this tests
CISRO competency component 1.3 — 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.