LLQP Accident & Sickness · Component 1.1 · 35% of the exam
A client's take-home pay depends heavily on overtime that his employer cannot guarantee. The agent should:
- Document the overtime history and expect the insurer to include a consistent pattern in earnings
- BInsure twice the base wage, since overtime commonly doubles a shift worker's take-home pay
- CTreat overtime as unearned income, which reduces the benefit the insurer will issue
- DInsure the base wage only and ignore overtime, since it is not guaranteed by the employer
Correct answer: A) Document the overtime history and expect the insurer to include a consistent pattern in earnings
Insurers count variable pay that the client has consistently earned, so the history supports a larger benefit than base wage alone while still resting on documented earnings.
Why the other options are wrong
- BDoubling the base wage is a guess with no documentary support.
- COvertime is earned income and stops with the disability; it is not unearned.
- DIgnoring consistent overtime under-insures a client whose household budget depends on it.
Exam tip
Consistent variable pay counts once it is documented.
Common mistake
Sizing the benefit on base pay for a client who lives on overtime.
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 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.