LLQP Accident & Sickness · Component 3.2 · 25% of the exam
When recommending a group LTD benefit formula, the agent should consider:
- AThe dental plan's co-insurance and annual maximums, since LTD is priced as part of the same benefits package
- BThe owner's personal preference for a rich or lean plan, since the owner is the one who pays the premium
- The percentage, cap, taxability, definition and switch, all-sources maximum, offsets and cost
- DOnly the percentage of earnings replaced, since that is the single figure employees compare across employers
Correct answer: C) The percentage, cap, taxability, definition and switch, all-sources maximum, offsets and cost
LTD design is multidimensional. The percentage alone says little about what a disabled employee will actually receive.
Why the other options are wrong
- ADental design is a separate decision and does not shape the LTD formula.
- BThe workforce's needs govern.
- DCap and tax dominate outcomes for many employees.
Exam tip
LTD design: percentage, cap, tax, definition, all-sources max, offsets, cost.
Common mistake
Quoting LTD by percentage only.
What this tests
CISRO competency component 3.2 — 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.