LLQP Accident & Sickness · Component 2.1 · 30% of the exam
Group LTD plans typically differ from individual DI in that group LTD:
- AHas stronger definitions of disability than most individual policies are able to offer
- BIs non-cancellable, since the plan sponsor cannot change the master contract once issued
- CIs always tax-free because the group premium is a deductible business expense to the employer
- Uses a two-tier definition, integrates with CPP, caps all-source income and is not portable
Correct answer: D) Uses a two-tier definition, integrates with CPP, caps all-source income and is not portable
These are the structural features that create gaps individual DI fills. Group LTD is cheaper and available without evidence up to a limit, but weaker in definition, portability and certainty.
Why the other options are wrong
- AIndividual DI generally has stronger definitions.
- BGroup contracts can be changed or cancelled by the sponsor or insurer.
- CTaxability depends on who pays the premium.
Exam tip
Group LTD weaknesses: definition switch, offsets, cap, no portability, possible tax.
Common mistake
Presenting group LTD as equivalent to individual coverage.
What this tests
CISRO competency component 2.1 — 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.