LLQP Accident & Sickness · Component 3.3 · 25% of the exam
Fraud in the application (deliberate misstatement) has the consequence that:
- The insurer may void the policy at any time, even after two years, and the agent who helped faces consequences
- BNothing happens once the policy has been issued, since the insurer accepted the risk on the evidence it had
- COnly the premium is adjusted to what it would have been had the truth been disclosed on the application
- DIt is forgiven after two years under the incontestability provision, in the same way as any innocent error
Correct answer: A) The insurer may void the policy at any time, even after two years, and the agent who helped faces consequences
Fraud is the exception to incontestability. Agents must never participate in or encourage misstatements.
Why the other options are wrong
- BSevere consequences follow.
- CRescission is the remedy.
- DFraud is contestable indefinitely.
Exam tip
Fraud: contestable forever; agent liability.
Common mistake
Helping a client 'simplify' their health history.
What this tests
CISRO competency component 3.3 — Implement a recommendation adapted to the client's needs and situation — which is weighted at 25% of the Accident & Sickness module. Written against the published curriculum.
More from component 3
- An underwriter assigns a disability applicant to occupational class 2 rather than class 4. The practical effect is that:
- A disability applicant discloses a back condition that resolved four years ago with no recurrence. The likely underwriting outcome is:
- Financial underwriting for an individual disability application exists to:
- A critical illness applicant's mother and sister both had breast cancer before fifty. The underwriter is likely to:
- An applicant for long-term care coverage is seventy-two. The insurer is most likely to require:
- Group long-term disability coverage within the non-evidence maximum is issued without individual medical questions because:
Practice the whole Accident & Sickness module
Timed sets weighted like the exam, and review of every question you miss. Free to start.