LLQP Accident & Sickness · Component 1.1 · 35% of the exam
Which of the following is a source of 'unearned income' in the client's financial situation?
- ASalary from full-time employment, paid every two weeks
- BCommissions earned on the client's own sales for the year
- Rental income received from an investment property
- DOvertime pay earned during the employer's busy season
Correct answer: C) Rental income received from an investment property
Unearned income — rents, dividends, interest — continues whether or not the client can work. It is a resource during disability, not income to be replaced, and insurers deduct it when setting the benefit.
Why the other options are wrong
- ASalary is earned income and stops with disability.
- BCommissions are earned income tied to the client's work.
- DOvertime is earned income and stops with disability.
Exam tip
Earned income is replaced; unearned income continues and reduces the insurable amount.
Common mistake
Applying for a DI benefit based on total income including rents and dividends.
What this tests
CISRO competency component 1.1 — 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.