LLQP Accident & Sickness · Component 1.3 · 35% of the exam
A client's analysis shows an income replacement need that will fall sharply once the mortgage is paid in twelve years. This suggests:
- AOnly the mortgage payment should be insured, since the rest of the need disappears with it
- BCoverage should be bought for twelve years and then dropped entirely from the plan
- CA twelve-year waiting period, matched to the point at which the mortgage is discharged
- A benefit period to age sixty-five, since the underlying income exposure continues past the mortgage
Correct answer: D) A benefit period to age sixty-five, since the underlying income exposure continues past the mortgage
Clearing the mortgage reduces the amount needed but not the exposure itself, because living costs continue for the rest of the client's working life.
Why the other options are wrong
- AA household needs far more than a mortgage payment to keep running.
- BDropping all coverage at that point leaves living costs unprotected.
- CA waiting period is measured in days or months, not years.
Exam tip
A falling need changes the amount, not the need for a long benefit period.
Common mistake
Matching the benefit period to a single debt.
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.