LLQP Accident & Sickness · Component 1.2 · 35% of the exam
A retired client asks whether her former employer's retiree health plan is secure. The agent should explain that:
- ARetiree plans convert automatically to individual coverage if the sponsor decides to end them
- Retiree health coverage is generally not vested and may be amended or ended by the sponsor
- CRetiree benefits are guaranteed for life once an employee has retired under the plan
- DThe provincial regulator must approve any change to a retiree health plan before it takes effect
Correct answer: B) Retiree health coverage is generally not vested and may be amended or ended by the sponsor
Unless the plan text clearly promises otherwise, retiree health benefits remain a sponsor-controlled arrangement and have been reduced or withdrawn in many cases.
Why the other options are wrong
- ANo automatic conversion right arises when a retiree plan is terminated.
- CRetiree health benefits are rarely vested and are frequently changed.
- DRegulators do not approve individual sponsors' benefit changes.
Exam tip
Retiree health benefits are a promise the sponsor can usually revisit.
Common mistake
Treating retiree coverage as a permanent part of the retirement plan.
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.