LLQP Accident & Sickness · Component 2.2 · 30% of the exam
A disability policy's 'cost of living adjustment' provision applies:
- ATo the premium, which rises each year with the published inflation index
- BTo the waiting period, which shortens each year the policy remains claim-free
- CTo the face amount before a claim, so that coverage keeps pace with the client's rising income
- To the benefit during an ongoing claim, so payments rise with inflation over a long disability
Correct answer: D) To the benefit during an ongoing claim, so payments rise with inflation over a long disability
A cost of living adjustment indexes benefits in payment, which protects a claimant whose disability lasts for years and whose purchasing power would otherwise erode steadily.
Why the other options are wrong
- AThe rider indexes benefits, not premiums.
- BWaiting periods are fixed by the contract and do not shorten over time.
- CPre-claim increases come from a future purchase option or an automatic increase feature.
Exam tip
Cost of living adjusts the benefit in claim; future purchase adjusts coverage before it.
Common mistake
Confusing in-claim indexing with pre-claim increases.
What this tests
CISRO competency component 2.2 — Analyze the available products that meet the client's needs — which is weighted at 30% of the Accident & Sickness module. Written against the published curriculum.
More from component 2
- A group benefits booklet lists AD&D coverage alongside life and LTD. The AD&D benefit pays:
- A hospital indemnity (hospital cash) policy pays:
- Employment Insurance sickness benefits are available to:
- Which government program coordinates with an individual DI policy through a possible offset AND also affects the definition of insurable income?
- A group plan's 'eligibility waiting period' (probationary period) is:
- A CI policy that is 'convertible' allows the insured to:
Practice the whole Accident & Sickness module
Timed sets weighted like the exam, and review of every question you miss. Free to start.