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LLQP · Ethics and Professional Practice (Common Law)

520 Ethics & Professional Practice Practice Questions

Published independent questions grouped by competency component. Counts are bank inventory, not an official exam distribution. Public answer access and account features depend on the current page and plan.

1.Integrate into practice the legal aspects of insurance and annuity contracts

60% of the exam · 312 questions
  1. In Canada, the regulation of insurance contracts and the licensing of agents falls mainly under:1.1
  2. The 'uniform' life insurance provisions in the common-law provinces' Insurance Acts mean that:1.1
  3. The Office of the Superintendent of Financial Institutions (OSFI) is responsible for:1.1
  4. A provincial insurance regulator (for example, FSRA in Ontario, BCFSA in British Columbia, or the AIC in Alberta) is responsible for:1.1
  5. The Canadian Council of Insurance Regulators (CCIR) and the Canadian Insurance Services Regulatory Organizations (CISRO) are:1.1
  6. The Canadian Life and Health Insurance Association (CLHIA) is:1.1
  7. Assuris is:1.1
  8. The OmbudService for Life & Health Insurance (OLHI) provides:1.1
  9. The Financial Consumer Agency of Canada (FCAC) is relevant to life agents because:1.1
  10. Under provincial Insurance Acts, a 'contract of life insurance' includes:1.1
  11. The principle of 'utmost good faith' (uberrimae fidei) in insurance contracts requires that:1.1
  12. 'Insurable interest' in life insurance means:1.1
  13. A contract of life insurance without insurable interest or the consent of the life insured is:1.1
  14. Life insurance is generally not a contract of 'indemnity'. This means:1.1
  15. The Personal Information Protection and Electronic Documents Act (PIPEDA) and equivalent provincial laws require an agent to:1.1
  16. Under the Proceeds of Crime (Money Laundering) and Terrorist Financing Act, life insurance agents and companies must:1.1
  17. The 'fair treatment of customers' (FTC) guidance issued by CCIR and CISRO expects agents and insurers to:1.1
  18. The Income Tax Act affects life insurance contracts by:1.1
  19. Provincial legislation typically requires an agent to be:1.1
  20. The 'Insurance Act' provisions on life insurance generally apply to contracts:1.1
  21. 'Common law' in the context of the LLQP ethics module refers to:1.1
  22. The 'statutory conditions' or statutory provisions in a life insurance contract:1.1
  23. Which of the following is a source of law governing an agent's conduct in addition to the Insurance Act?1.1
  24. The federal Genetic Non-Discrimination Act affects the legal framework of life insurance by:1.1
  25. A 'regulation' made under a provincial Insurance Act differs from the Act itself in that:1.1
  26. The insurer's 'ombudsman' or complaints officer is:1.1
  27. Which body would investigate an allegation that an agent forged a client's signature?1.1
  28. Legislation dealing with 'unfair or deceptive acts or practices' in insurance prohibits:1.1
  29. The Criminal Code is relevant to agents because:1.1
  30. Provincial human rights legislation affects insurance by:1.1
  31. Family law legislation intersects with life insurance when:1.1
  32. Bankruptcy legislation affects life insurance and annuities by:1.1
  33. The common law of 'agency' establishes that an insurance agent:1.1
  34. The tort of 'negligence' applies to an agent who:1.1
  35. Errors and omissions (E&O) insurance for agents:1.1
  36. 'Tied selling' or coercive tied selling is:1.1
  37. The legal framework requires that insurance policies delivered in a province be:1.1
  38. The role of the courts in the insurance legal framework is to:1.1
  39. 'Rebating' — returning part of the commission to a client as an inducement — is:1.1
  40. A client asks which law applies if their insurer is federally incorporated and the client lives in Ontario. The agent should explain:1.1
  41. The parties and persons involved in a life insurance contract are:1.2
  42. The 'policyowner' of a life insurance contract has the right to:1.2
  43. The 'life insured' is:1.2
  44. The 'beneficiary' of a life insurance contract:1.2
  45. A 'contingent' (secondary) beneficiary:1.2
  46. The 'applicant' on a life insurance application is:1.2
  47. The insurer's obligations under the contract include:1.2
  48. A minor as beneficiary raises the issue that:1.2
  49. The 'group policyholder' in group insurance is:1.2
  50. An 'assignee' of a life insurance policy is:1.2
  51. A corporation as policyowner and beneficiary of a policy on a key employee:1.2
  52. A 'trustee' named to receive proceeds on behalf of a beneficiary:1.2
  53. The 'personal representative' (executor or administrator) of a deceased owner:1.2
  54. When the owner and life insured are different people and the owner dies first:1.2
  55. The agent's role relative to the parties is:1.2
  56. A client wants to name her daughter as beneficiary but cannot find the insurer's form. Under the Insurance Act, a designation may be made:1.2
  57. A 'joint owner' arrangement on a life policy (two owners) means:1.2
  58. For a policy owned by one spouse on the other spouse's life, with the children as beneficiaries, the roles are:1.2
  59. The 'insurer' as a party must be:1.2
  60. A 'successor owner' or 'contingent owner' designation:1.2
  61. The essential elements for a valid insurance contract are:1.3
  62. In life insurance, the 'offer' is usually made by:1.3
  63. 'Consideration' in a life insurance contract consists of:1.3
  64. 'Capacity' to contract for life insurance is lacking in:1.3
  65. A life insurance contract generally 'takes effect' when:1.3
  66. A 'conditional insurance agreement' (temporary insurance receipt) provides:1.3
  67. The 'grace period' under a life insurance contract:1.3
  68. A policy 'lapses' when:1.3
  69. The statutory right of 'reinstatement' of a lapsed life policy generally allows the owner to:1.3
  70. The 'rescission' (free-look) right in life insurance:1.3
  71. A life policy may be 'terminated' by:1.3
  72. 'Non-forfeiture' options in a cash-value policy:1.3
  73. The 'incontestability' provision means that after the policy has been in force for two years during the life insured's lifetime:1.3
  74. The statutory rule on 'misrepresentation' within the contestability period allows the insurer to:1.3
  75. The 'suicide' provision in life insurance typically:1.3
  76. The 'misstatement of age' provision in life insurance:1.3
  77. An insurer 'rescinds' a policy within the contestability period by:1.3
  78. A 'change in insurability' between application and delivery (for example, a new diagnosis) has the effect that:1.3
  79. The 'entire contract' provision states that:1.3
  80. A 'policy loan' provision in a permanent policy:1.3
  81. The 'effective date' versus the 'issue date' of a policy matters because:1.3
  82. If the applicant dies after signing the application but before the policy is issued, and no conditional coverage applies:1.3
  83. A 'counter-offer' by the insurer (policy issued with a rating or exclusion) becomes a contract when:1.3
  84. The statutory provisions on 'designation of beneficiary' after lapse and reinstatement provide that:1.3
  85. A group life insurance certificate holder whose employment ends generally has:1.3
  86. 'Undue influence' or 'duress' in the formation of an insurance contract:1.3
  87. The statutory requirement that a contract contain the 'name of the insurer, the insured, the beneficiary, the amount, the premium, the term, and the conditions' ensures that:1.3
  88. A 'binding receipt' differs from a 'conditional receipt' in that a binding receipt:1.3
  89. The insurer's 'right to examine' or require evidence during formation:1.3
  90. A term policy's 'renewal' provision:1.3
  91. A term policy's 'conversion' provision:1.3
  92. If the first premium cheque is returned NSF after the policy is delivered:1.3
  93. 'Surrender' of a permanent policy by the owner:1.3
  94. The 'automatic premium loan' (APL) provision:1.3
  95. A life insurance contract 'matures' when:1.3
  96. The insurer must provide the owner with 'notice of lapse' in the sense that:1.3
  97. For a policy reinstated after lapse, the two-year contestability period:1.3
  98. An agent who delivers a policy must:1.3
  99. 'Legality of purpose' as a formation requirement means an insurance contract is void if:1.3
  100. A client asks whether the insurer can cancel her in-force whole life policy because she developed a serious illness. The correct answer is:1.3
  101. The 'insuring clause' or 'insuring agreement' of a life policy states:1.4
  102. The 'premium' provisions of a life policy set out:1.4
  103. The 'ownership' provision of a policy:1.4
  104. The 'assignment' provision typically states that:1.4
  105. The 'exclusions' in a life policy commonly include:1.4
  106. The 'dividend' provision in a participating policy:1.4
  107. The 'settlement options' provision allows the death benefit to be paid:1.4
  108. A 'waiver of premium' rider on a life policy:1.4
  109. A 'guaranteed insurability' rider on a life policy allows:1.4
  110. An 'accidental death benefit' rider:1.4
  111. A 'child term rider' or 'family rider':1.4
  112. The 'reinstatement' provision in the contract:1.4
  113. The 'incontestability' clause in the contract:1.4
  114. A 'cost of insurance' (COI) provision in universal life:1.4
  115. The 'policy fund' or 'account value' provision of a universal life policy explains:1.4
  116. The 'death benefit option' in universal life (level vs increasing):1.4
  117. The 'exempt policy' rules under the Income Tax Act mean that:1.4
  118. The 'adjusted cost basis' (ACB) of a life policy is relevant because:1.4
  119. The 'annuity contract' provisions specify:1.4
  120. The 'segregated fund' contract provisions include:1.4
  121. A 'fundamental change' provision in a segregated fund contract gives the owner:1.4
  122. The 'accident and sickness' provisions attached to a life policy (for example, a CI or DI rider) are governed by:1.4
  123. The 'modification' or 'changes to the contract' provision states that:1.4
  124. A 'participating' versus 'non-participating' policy:1.4
  125. The 'currency and place of payment' provision:1.4
  126. A 'return of premium' provision on term insurance:1.4
  127. The 'grace period' provision in the contract:1.4
  128. A couple buys a policy that pays when either of them dies, to replace the lost income. This joint first-to-die policy:1.4
  129. A 'joint last-to-die' policy provision:1.4
  130. The 'legal actions' provision in life insurance:1.4
  131. The 'payor benefit' rider on a juvenile policy:1.4
  132. The 'cash surrender value' provision:1.4
  133. A 'revocable' beneficiary designation means:1.5
  134. A business owner names his wife irrevocably to strengthen creditor protection. He should understand that an irrevocable designation means:1.5
  135. A designation of a minor as irrevocable beneficiary:1.5
  136. The 'protected class' or 'family class' of beneficiaries for exemption from seizure in common-law provinces includes:1.5
  137. 'Exemption from seizure' of insurance money means:1.5
  138. When the beneficiary is the 'estate' of the life insured, the proceeds:1.5
  139. If the sole named beneficiary predeceases the life insured and no contingent is named:1.5
  140. Where several beneficiaries are named without shares specified:1.5
  141. A beneficiary designation made in a 'will':1.5
  142. The insurer's protection when paying a beneficiary is that:1.5
  143. A beneficiary who feloniously causes the death of the life insured:1.5
  144. A 'trustee' designation for an adult beneficiary who is incapable:1.5
  145. The exemption from seizure for a policy with a family-class beneficiary applies:1.5
  146. A creditor of the beneficiary (not the owner):1.5
  147. A designation of the 'spouse' by that word rather than by name:1.5
  148. Under common-law provinces' rules, divorce:1.5
  149. A designation 'to my children' typically includes:1.5
  150. 'Per stirpes' in a designation means:1.5
  151. For a group life certificate, the beneficiary designation is made by:1.5
  152. A 'declaration' for beneficiary purposes under the Insurance Act is:1.5
  153. Proceeds payable to a named beneficiary (not the estate) are:1.5
  154. A designation of a beneficiary 'in trust' with a named trustee:1.5
  155. The effect of naming a charity as beneficiary is that:1.5
  156. A beneficiary designation for a registered plan (RRSP/RRIF/TFSA) in common-law provinces:1.5
  157. If a beneficiary cannot be located after the life insured's death:1.5
  158. An owner wants to change a beneficiary but the existing beneficiary is irrevocable and refuses consent. The result is:1.5
  159. A beneficiary designation made under a power of attorney by the attorney:1.5
  160. The exemption from seizure for insurance contracts extends to segregated fund contracts and annuities because:1.5
  161. When a deposit into a creditor-protected seg fund is made shortly before bankruptcy with intent to shield assets:1.5
  162. The agent's best practice at every review regarding beneficiaries is to:1.5
  163. To claim a life insurance death benefit, the claimant must generally provide:1.6
  164. The Insurance Act requires the insurer, within a set time after receiving sufficient evidence of the claim (commonly 30 days), to:1.6
  165. Interest on death benefits:1.6
  166. 'Payment into court' by an insurer occurs when:1.6
  167. The 'limitation period' for suing an insurer on a life insurance claim:1.6
  168. An insurer's 'defences' to a life claim may include:1.6
  169. For an accident and sickness claim under the statutory conditions, the claimant must:1.6
  170. The insurer's right to 'examine' a claimant under an A&S contract means:1.6
  171. 'Proof of loss' for a disability claim consists of:1.6
  172. A claim under a segregated fund contract on the annuitant's death requires:1.6
  173. The agent's role when a client dies is to:1.6
  174. A claim is denied for misrepresentation. The beneficiary's options include:1.6
  175. When a life insured dies within the two-year contestability period, the insurer typically:1.6
  176. A 'simultaneous death' of the life insured and the beneficiary (common disaster) is resolved by:1.6
  177. If the insurer pays a claim and later discovers fraud:1.6
  178. A claim for a death that occurred abroad requires:1.6
  179. A disability claimant is required to provide 'continuing proof' because:1.6
  180. The 'assignment of benefits' at claim time means:1.6
  181. A claim under a group life certificate is made by:1.6
  182. 'Good faith claims handling' obligates the insurer to:1.6
  183. A claim under a critical illness policy requires:1.6
  184. When a life insured is missing and presumed dead:1.6
  185. If a policy has an outstanding loan at death:1.6
  186. A claim where the beneficiary is the estate and there is no will:1.6
  187. The insurer discovers at claim that the life insured's age was misstated. The claim is:1.6
  188. The tax treatment of a life insurance death benefit paid to a named beneficiary is:1.6
  189. For an annuity in payment, when the annuitant dies during a guarantee period, the claim involves:1.6
  190. A claimant is dissatisfied with the insurer's claim decision. The proper escalation is:1.6
  191. Privacy at claim time requires the agent to:1.6
  192. The 'proof of claim' for a maturity or endowment payment under a life policy requires:1.6
  193. An agent licensed only in Ontario is asked to advise a long-standing client who has moved permanently to Alberta. The agent must:1.1
  194. An agent holds licences in two provinces whose continuing education and disclosure requirements differ. The agent must:1.1
  195. A client asks why a federally incorporated insurer's policy is still governed by his province's Insurance Act. The agent should explain that:1.1
  196. A life-licensed agent is asked by a client to recommend a mutual fund. The agent should explain that:1.1
  197. An agent is found by the provincial regulator to have misled several clients. The regulator's powers typically include:1.1
  198. An agent realizes near the end of the licence period that he has completed no continuing education. The likely consequence is that:1.1
  199. An agent is convicted of a criminal offence involving dishonesty unrelated to her insurance work. She must:1.1
  200. A client remains unhappy after the insurer's internal complaints officer has issued a final position. The agent should explain that the client may:1.1
  201. A client asks whether the federal deposit insurance that protects his bank account also covers his life insurance policy. The agent should explain that:1.1
  202. An agent plans to email a marketing newsletter to a purchased list of local residents. Canadian anti-spam legislation requires that:1.1
  203. An agent builds a prospecting list by telephoning names from a public directory. Before calling the agent must:1.1
  204. An applicant mentions that she once took a genetic test. Under federal law the agent must understand that:1.1
  205. An agent declines to meet a prospective client because of the client's religion. This conduct is:1.1
  206. An agent's laptop holding unencrypted client files is stolen from a car. Privacy legislation requires the agent to:1.1
  207. A client mails back a signed change form and asks the agent to sign as witness. The agent should:1.1
  208. An agent deposits a client's premium cheque into her own account, intending to forward the money the following week. This conduct is:1.1
  209. A client questions whether the agent can act in the client's interest when the insurer pays the commission. The most accurate answer is that the agent:1.1
  210. A client suffers a loss after an agent failed to submit an application she had been paid to process. The client may:1.1
  211. An agent is asked how long identification and transaction records must be kept under anti-money-laundering rules. The correct position is that records must be:1.1
  212. An agent's advertisement describes a segregated fund as offering a return that cannot fall. Legislation on unfair or deceptive practices means this advertisement is:1.1
  213. A client wants to insure the life of his business partner to fund a buy-sell agreement. Insurable interest:1.2
  214. A client wants to buy a new policy on the life of her former spouse, from whom she receives support payments. The agent should explain that:1.2
  215. A father wants to take out a policy on his thirty-year-old daughter's life without telling her. The agent must explain that:1.2
  216. A client asks to replace the life insured on an existing policy with her younger spouse. The agent should explain that:1.2
  217. A corporation owns a policy on a departing shareholder and wants to transfer ownership to him personally. The agent should explain that:1.2
  218. A policy owner names her estate as beneficiary. On her death the proceeds will be:1.2
  219. A policy is absolutely assigned to a new owner while a revocable beneficiary remains named. The effect is that the assignee:1.2
  220. A bank takes a collateral assignment of a client's life policy to secure a loan. On the client's death the bank is entitled to:1.2
  221. A grandparent wants to make a fifteen-year-old the owner of a policy on the child's own life. The agent should explain that:1.2
  222. A client in a long-term common-law relationship wants his partner to own a policy on his life. The agent should confirm that:1.2
  223. An employee covered under her employer's group life plan asks the agent to change a policy term for her. The agent should explain that:1.2
  224. A grandmother applies for a policy on her infant grandchild's life. The requirements include:1.2
  225. A client's attorney under a continuing power of attorney wants to surrender the client's policy for cash. The agent should:1.2
  226. Two joint owners of a policy disagree, and one alone instructs the agent to change the beneficiary. The agent should explain that:1.2
  227. An elderly client with no close relatives asks the agent to be named as beneficiary of her policy. The agent should:1.2
  228. A client asks the agent to act as trustee for proceeds payable to her young children. The agent should:1.2
  229. A corporation owns key person coverage and asks what happens if it is wound up. The agent should explain that a successor owner designation:1.2
  230. A life insured who does not own the policy asks the agent for a copy of the contract and its values. The agent should:1.2
  231. A policy owner has become mentally incapable and no power of attorney exists. Ownership rights will generally be exercised by:1.2
  232. A family trust is proposed as the owner and beneficiary of a policy on a parent's life. The agent should understand that:1.2
  233. Eighteen months after a policy is issued, the insurer discovers the applicant failed to disclose a serious diagnosis. The insurer may:1.3
  234. A client pays the first premium with the application and dies before underwriting is complete. The temporary insurance agreement:1.3
  235. An insurer issues a policy with a rating the applicant did not request. In contract terms this issued policy is:1.3
  236. Between application and delivery, an applicant is diagnosed with a serious illness. At delivery the agent must:1.3
  237. An agent delivers a policy containing an exclusion the client never saw, and the client signs nothing. The likely position is that:1.3
  238. A client misses a premium and dies twenty days later without paying it. The grace period means the insurer will generally:1.3
  239. A client whose policy lapsed eighteen months ago asks to have it reinstated. The insurer will typically require:1.3
  240. A client stops paying premiums on a whole life policy with substantial cash value and assumes it has lapsed. In fact the automatic premium loan provision may have:1.3
  241. A client returns her newly delivered policy within the rescission period stated in the contract. The insurer must:1.3
  242. Six years after issue, an insurer discovers a non-fraudulent error in the answers on a client's application. The insurer may:1.3
  243. At claim, a family shows that the agent recorded an answer on the application differently from what the client actually said. The agent's exposure includes:1.3
  244. An applicant signs an application written in a language he cannot read. Before submitting it the agent must:1.3
  245. A client reinstates a lapsed policy and dies by suicide eight months later. The suicide provision will generally:1.3
  246. A client's renewable term policy reaches the end of its term and she is now in poor health. The renewal provision means she:1.3
  247. A client in his late fifties asks to convert his term policy to permanent coverage. The agent should check:1.3
  248. An employee whose job ends is told her group life coverage stops at the end of the month. The agent should explain that she may:1.3
  249. An insurer treats a policy as lapsed although it never sent the notice the legislation requires. The likely consequence is that:1.3
  250. A client whose birthday falls next week asks whether the policy can be dated earlier to secure a lower age. The agent should explain that:1.3
  251. An applicant dies after the insurer approved and issued the policy but before it was delivered and the first premium paid. Coverage will generally depend on:1.3
  252. An agent realizes that a client signed an application while visibly intoxicated. The agent should:1.3
  253. A universal life policyholder complains that his monthly deduction has climbed steeply over the past decade. The agent should explain that:1.4
  254. A client takes a policy loan against her whole life contract and asks how it affects her family. The agent should explain that:1.4
  255. A participating policyholder has left dividends on deposit with the insurer for many years. At death these amounts will generally be:1.4
  256. A couple wants coverage on both lives but only one of them needs a large amount. A term rider on the spouse would:1.4
  257. A critical illness policyholder is diagnosed with a covered condition but dies four days later. The survival period provision typically means that:1.4
  258. A client with a waiver of premium rider becomes disabled and asks when the insurer will stop billing him. The agent should explain that:1.4
  259. A beneficiary asks whether the accidental death rider pays because the insured died of a heart attack while driving. The agent should explain that:1.4
  260. A participating policyholder was told his premiums would eventually be covered by dividends, but the insurer is still billing him. The agent should explain that:1.4
  261. A client wants to deposit far more into a universal life policy than the plan anticipated. The agent should warn that:1.4
  262. A participating policyholder selects the paid-up additions dividend option. This means each dividend will:1.4
  263. A client is shocked when his ten-year term premium jumps sharply at the end of the term. The agent should have explained at the outset that:1.4
  264. A client who flies a private aircraft as a hobby is issued a policy with an aviation exclusion. The effect is that:1.4
  265. A client fears his adult son would spend a lump sum quickly. The settlement options provision allows the client to:1.4
  266. A client with a guaranteed insurability rider wants to add coverage after a serious diagnosis. The agent should explain that:1.4
  267. A couple wants coverage to fund the tax arising when the second of them dies. The provision suited to this need is:1.4
  268. A client points to an illustration showing dividends increasing every year and asks whether that is promised. The agent must explain that:1.4
  269. A client surrenders a permanent policy and is surprised to receive a tax slip. The agent should explain that:1.4
  270. A client asks what her critical illness policy pays if she dies without ever being diagnosed. The return of premium on death benefit:1.4
  271. A client who will live abroad for three years asks whether her coverage continues. The agent should:1.4
  272. A whole life policyholder receives a notice from the insurer and fears his guaranteed premium will rise. The agent should explain that:1.4
  273. A client designated 'my wife Jane' years ago, later divorced and has now remarried. Unless the designation is changed:1.5
  274. A client's will, signed after the policy designation, leaves the insurance proceeds to a different person. The position in common law provinces is that:1.5
  275. A client named her three children equally, and one child dies before her leaving two young sons. Without a per stirpes direction the proceeds will normally:1.5
  276. A business owner exposed to creditors names his estate as beneficiary for administrative simplicity. The agent should point out that:1.5
  277. A separating client wants to remove his spouse, who was named irrevocably. The agent should explain that:1.5
  278. A client names a registered charity as beneficiary of her life policy. On her death her estate will generally:1.5
  279. A Quebec client designates her married spouse as beneficiary without saying anything about revocability. The likely result is that:1.5
  280. A client names his adult daughter as beneficiary of his registered retirement income fund. His agent should point out that:1.5
  281. A client wants to name her brother, who lives overseas, as beneficiary. The agent should explain that:1.5
  282. A client wants the proceeds used only for her granddaughter's education. The appropriate structure is to:1.5
  283. A creditor of a policy owner seeks to seize a policy on which the owner's spouse is named beneficiary. In the common law provinces the policy is generally:1.5
  284. A client with a family class beneficiary collaterally assigns his policy to a lender. The effect on creditor protection is that:1.5
  285. A deceased client named her estate as beneficiary and left substantial unpaid debts. The proceeds will be:1.5
  286. A shareholder personally owns a policy and wants his corporation named as beneficiary. The agent should warn that:1.5
  287. An employee names a beneficiary on her group life certificate and also has an individual policy. She should understand that:1.5
  288. A designation gives one beneficiary a stated share and leaves the remainder unallocated. The unallocated portion will generally:1.5
  289. An insurer pays the beneficiary shown in its records, and a later designation form is then produced. The statutory protection means that:1.5
  290. A named beneficiary tells the insurer she does not want the proceeds. Where she validly disclaims, the money will generally:1.5
  291. A client asks whether naming his son on his registered plan will prevent tax arising on his death. The correct answer is that the designation:1.5
  292. A separation agreement requires a client to keep his former spouse as beneficiary of a policy. If he names someone else instead:1.5
  293. A beneficiary telephones the agent the day after the insured's death. The agent's first step should be to:1.6
  294. A family cannot find the policy document for a client they believe was insured. The agent should explain that:1.6
  295. An insurer takes several months to settle a death claim after receiving complete proof. The legislation generally provides that:1.6
  296. An insurer asks a claimant to sign an authorization for the deceased's medical records during the contestability period. The agent should explain that:1.6
  297. The named beneficiary of a death benefit is an adult who lacks capacity to manage money. The proceeds will generally:1.6
  298. An insurer pays a base death benefit but declines the accidental death rider. The beneficiary should understand that:1.6
  299. At claim the insurer discovers the insured was three years older than stated on the application. Under the misstatement of age provision the insurer will:1.6
  300. An insured dies during the grace period with one premium unpaid. At claim the insurer will normally:1.6
  301. A critical illness claimant's diagnosis does not match the contract's definition of the covered condition. The agent should explain that:1.6
  302. A disability claimant asks why no benefit has arrived although her claim was approved. The likely explanation is that:1.6
  303. A grieving claimant asks the agent to fill in and sign the claim form for her. The agent should:1.6
  304. An insurer asks a claimant to prove her identity and her relationship to the deceased. This requirement exists because:1.6
  305. A beneficiary asks whether she must report the life insurance death benefit on her tax return. The agent should explain that:1.6
  306. An insured disappears at sea and the family asks when a claim can be made. The agent should explain that:1.6
  307. A family is certain a policy existed but the insurer's initial search finds nothing. The agent should:1.6
  308. A beneficiary believes the settlement the insurer has calculated is too low. The agent should:1.6
  309. An agent settling a claim notices the deceased held a second policy with the same insurer that nobody has mentioned. The agent should:1.6
  310. A death occurred abroad and the certificate is written in a language other than English or French. The insurer will generally require:1.6
  311. A named beneficiary is convicted of criminally causing the insured's death. The proceeds will generally:1.6
  312. After a death claim is settled, the agent's file should record:1.6

2.Integrate into practice the rules governing the activities of life insurance agents

40% of the exam · 208 questions
  1. The primary body that licenses and disciplines life insurance agents in a province is:2.1
  2. The sanctions a provincial regulator or council can impose on an agent include:2.1
  3. The role of CISRO in protecting clients is to:2.1
  4. The CCIR's 'Guidance: Conduct of Insurance Business and Fair Treatment of Customers' matters to agents because:2.1
  5. OSFI protects clients indirectly by:2.1
  6. Assuris coverage applies to:2.1
  7. OLHI's services are available to:2.1
  8. Complaints about an agent's conduct (as opposed to an insurer's claim decision) should be directed to:2.1
  9. CLHIA protects clients by:2.1
  10. The federal Privacy Commissioner (and provincial commissioners) protect clients by:2.1
  11. FINTRAC's role is to:2.1
  12. The courts protect clients in insurance matters by:2.1
  13. Professional associations such as Advocis (and its designation bodies) protect clients by:2.1
  14. An insurer's own compliance function protects clients by:2.1
  15. A managing general agency (MGA) has responsibilities toward clients through:2.1
  16. The provincial regulator's 'licence check' or public register allows clients to:2.1
  17. 'Errors and omissions' insurance protects clients because:2.1
  18. The Financial Consumer Agency of Canada protects insurance clients mainly where:2.1
  19. The Canadian Anti-Fraud Centre and provincial consumer-protection offices help clients by:2.1
  20. The 'Life Licence Qualification Program' itself protects clients by:2.1
  21. Continuing education requirements protect clients because:2.1
  22. The provincial regulator's power to conduct 'market conduct examinations' means:2.1
  23. The requirement that agents be 'sponsored' by or contracted with an insurer in many provinces protects clients because:2.1
  24. The 'Ombudsman for Banking Services and Investments' (OBSI) is relevant to a dual-licensed agent because:2.1
  25. Provincial 'insurance councils' (for example, in Alberta, BC, Saskatchewan, Manitoba) are:2.1
  26. The requirement to give clients a written 'disclosure' about the agent (licence, insurers represented, compensation, conflicts) is enforced by:2.1
  27. Whistleblower or reporting obligations protect clients because:2.1
  28. The interplay between regulators and insurers when an agent is terminated 'for cause' is that:2.1
  29. Provincial 'unclaimed property' or unclaimed benefits regimes protect clients by:2.1
  30. The role of the 'Autorité des marchés financiers' (AMF) is relevant to a common-law agent when:2.1
  31. 'Reciprocal licensing' between provinces means:2.1
  32. The requirement for a 'complaint-handling process' at the insurer level (with a designated complaints officer and public information) exists because:2.1
  33. The 'public interest' mandate of regulators means that when an agent's interests conflict with client protection, the regulator will:2.1
  34. The CLHIA 'Advisor Disclosure' guideline recommends that agents disclose to clients:2.1
  35. The 'Canadian Association of Independent Life Brokerage Agencies' (CAILBA) contributes to client protection by:2.1
  36. If a client believes their personal health information was shared improperly by an agent, the appropriate bodies are:2.1
  37. The requirement that illustrations follow the CLHIA 'Guidelines on Illustrations' protects clients by:2.1
  38. The regulators' focus on 'vulnerable clients' (seniors, persons with diminished capacity) protects them by:2.1
  39. A client asks who to contact if they suspect their agent is unlicensed. The answer is:2.1
  40. The insurer's obligation under FTC guidance to 'design products with target markets in mind' protects clients because:2.1
  41. The 'National Do Not Call List' and anti-spam legislation (CASL) protect clients by:2.1
  42. The requirement that insurers provide 'plain-language' policy summaries or key facts documents protects clients by:2.1
  43. The 'Insurance Bureau of Canada' (IBC) is:2.1
  44. A regulator's 'consumer alert' or public warning about an individual or firm is:2.1
  45. The most complete list of the bodies a life agent may be accountable to is:2.1
  46. For a dual-licensed agent selling mutual funds, the relevant SRO is:2.1
  47. The Canada Deposit Insurance Corporation (CDIC) protects:2.1
  48. When a client asks an agent 'who protects me if something goes wrong?', the best answer covers:2.1
  49. An agent's foundational duty to the client is:2.2
  50. 'Know your client' (KYC) obligations require the agent to:2.2
  51. A recommendation is 'suitable' when:2.2
  52. The agent's 'duty of disclosure' to the client includes:2.2
  53. A 'conflict of interest' arises when:2.2
  54. Compensation disclosure rules generally require an agent to tell the client:2.2
  55. 'Holding out' rules require that an agent:2.2
  56. When replacing an existing life policy, the agent must:2.2
  57. 'Twisting' is:2.2
  58. 'Churning' refers to:2.2
  59. Rules on 'handling client funds' require that an agent:2.2
  60. The agent's 'confidentiality' obligation means:2.2
  61. Record-keeping obligations require the agent to:2.2
  62. An agent's advertising and marketing must:2.2
  63. Completing an application, the agent must:2.2
  64. 'Forgery' or signing a client's name, even with permission, is:2.2
  65. Electronic signatures on insurance documents are:2.2
  66. An agent must not 'induce' a purchase by:2.2
  67. 'Fronting' — allowing another person to sell under the agent's licence — is:2.2
  68. Unlicensed staff in an agent's office may:2.2
  69. When an agent lacks expertise in a client's need (for example, complex corporate tax planning), the agent should:2.2
  70. 'Referral arrangements' where an agent pays or receives fees for referrals:2.2
  71. An agent becomes aware that a client is being financially exploited by a family member. The agent should:2.2
  72. An agent must report to the regulator (self-report) events such as:2.2
  73. Selling a product from an insurer the agent is not contracted with, through another agent's contract ('splitting' without disclosure), is:2.2
  74. An agent's obligation regarding 'needs analysis' documentation is to:2.2
  75. If a client insists on a product the agent believes is unsuitable, the agent should:2.2
  76. The obligation to 'deliver the policy promptly' exists because:2.2
  77. An agent learns after delivery that the client omitted a material health fact on the application. The agent should:2.2
  78. The agent's responsibility for 'illustrations' is to:2.2
  79. An agent's obligation when a client's premium is about to lapse is to:2.2
  80. 'Misrepresentation' by an agent includes:2.2
  81. The 'best interest' expectation in FTC guidance means the agent should:2.2
  82. An agent who is 'captive' (contracted to one insurer) must:2.2
  83. An agent may accept a gift from a client:2.2
  84. 'Outside business activities' of an agent (for example, a mortgage brokerage or tax preparation) must be:2.2
  85. The obligation to 'cooperate with regulators and insurers' means the agent must:2.2
  86. An agent's duty when a client asks them to backdate a document or misstate a date is to:2.2
  87. The agent's obligation regarding 'group insurance enrolment' is to:2.2
  88. When an agent leaves an insurer or MGA, their obligation regarding clients is to:2.2
  89. A client asks the agent to recommend a policy for her elderly father, who is not present. The agent should:2.2
  90. An insurer runs a sales contest with a trip for agents who reach a target with one product. The agent's obligation is to:2.2
  91. A client wants to surrender a permanent policy with a large gain to buy a new policy the agent is offering. The agent should:2.2
  92. A client's spouse calls asking about the client's policy details. The agent should:2.2
  93. A prospective client wants to buy a large annuity with cash from an unexplained source and seems evasive. The agent should:2.2
  94. An agent discovers a colleague is forging client signatures. The agent's obligation is to:2.2
  95. A client wants to name the agent as beneficiary 'because you've been so helpful'. The agent must:2.2
  96. A client asks the agent to hold a cheque and 'submit it next month when the bonus comes in'. The agent should:2.2
  97. During a review, an agent finds a client's seg fund has a guarantee about to mature while the market is well above the guaranteed amount. The agent should:2.2
  98. An agent uses a social media post claiming 'tax-free retirement income guaranteed' for a UL policy. This is:2.2
  99. A client with limited English asks a relative to interpret. The agent should:2.2
  100. A client asks the agent to 'just put down non-smoker' although she smokes occasionally. The agent must:2.2
  101. A client asks whether the agent is required to tell them about cheaper products from other insurers. The honest answer depends on:2.2
  102. An agent receives a subpoena for client records. The agent should:2.2
  103. A client asks the agent to invest in a private business deal alongside them. The agent should:2.2
  104. The agent's obligation regarding 'continuing suitability' means:2.2
  105. A client asks the agent for tax and legal advice on a complex estate freeze. The agent should:2.2
  106. A client wants to buy a policy for a business partner but the partner has not agreed. The agent should:2.2
  107. A client asks for a copy of the personal information the agent holds about them. The agent must:2.2
  108. The agent's obligation when an insurer requests additional underwriting information from the client is to:2.2
  109. 'Professional judgment' in ethics means the agent should:2.2
  110. An agent is asked by an MGA to 'sign off' on applications taken by an unlicensed trainee. The agent should:2.2
  111. An agent must maintain 'competence' by:2.2
  112. A client asks the agent to recommend a beneficiary designation that would defeat a court-ordered support obligation. The agent should:2.2
  113. The agent's obligation to 'explain the policy at delivery' includes:2.2
  114. A client mentions during a review that she has been diagnosed with early dementia. Regarding a proposed large seg fund transfer she requested, the agent should:2.2
  115. An agent who is also licensed to sell mutual funds must:2.2
  116. A client complains to the agent about the insurer's service. The agent should:2.2
  117. The agent's obligation regarding 'insurer's underwriting guidelines' is to:2.2
  118. An agent receives a 'lead' from a referral service that obtained the client's data without consent. The agent should:2.2
  119. The 'reasonable expectations' of a client include that the agent will:2.2
  120. An agent is offered a 'finder's fee' by a developer for referring clients to a real estate investment. The agent should:2.2
  121. A client asks the agent to keep a copy of her will and POA 'for safekeeping'. The agent should:2.2
  122. An agent's obligation when a client dies and the agent is aware of a policy the family does not know about is to:2.2
  123. 'Supervision' obligations for an agent who leads a team mean:2.2
  124. A client asks the agent to provide a 'letter of coverage' before the insurer has approved the application. The agent should:2.2
  125. When a client's circumstances mean insurance is not needed, the ethical agent:2.2
  126. An agent's 'duty to the insurer' includes:2.2
  127. If an agent's own licence lapses (missed renewal or CE), the agent must:2.2
  128. The best summary of an agent's ethical obligations is to:2.2
  129. A prospective client wants to confirm that an agent is properly licensed before meeting him. She should:2.1
  130. A client's federally incorporated insurer has merged with another company and he asks who watches its financial strength. The answer is:2.1
  131. A client sees an insurer advertisement she believes is misleading. The body that would examine the conduct is:2.1
  132. A client is delighted that the ombudservice has recommended in his favour and asks when the insurer must pay. The agent should explain that:2.1
  133. An insurer terminates an agent's contract for cause after finding falsified applications. The insurer is generally required to:2.1
  134. A managing general agency contracts a new agent. Its screening responsibility toward clients includes:2.1
  135. A client believes an insurer disclosed her health information improperly and the insurer's response has not satisfied her. She may next:2.1
  136. A client with a very large policy asks how much of it Assuris would protect if the insurer failed. The agent should explain that:2.1
  137. A client asks whether Assuris stands behind the maturity guarantee on her segregated fund contract. The accurate answer is that:2.1
  138. An agent licensed in Ontario is asked to serve a client residing in Quebec. The body whose licensing requirements apply is:2.1
  139. A dual-licensed agent's mutual fund business is reviewed following a client complaint. The review will be conducted by:2.1
  140. A candidate asks who sets the national qualification standard the licensing examinations are based on. The answer is:2.1
  141. Under fair treatment of customers guidance, an insurer's responsibility for a product it has sold:2.1
  142. A client is telephoned by someone claiming to be from the regulator and demanding a payment to release a policy benefit. The agent should advise her to:2.1
  143. An insurer cannot trace the beneficiary of a matured benefit after extensive searching. Unclaimed property arrangements exist so that:2.1
  144. An agent hesitates to report a colleague's misconduct for fear of retaliation. Whistleblower provisions generally:2.1
  145. A regulator announces a market conduct examination of an agency. The agency must expect the examination to review:2.1
  146. A client holds a policy from a foreign insurer that is not an Assuris member. The agent should explain that:2.1
  147. Industry disclosure guidance expects an agent to tell a new client, at or before the first transaction:2.1
  148. An agent presents an illustration produced by the insurer's software. Industry guidelines mean that:2.1
  149. A client wants to complain about an insurer's handling of her file. The first formal step is to:2.1
  150. A client asks whether the insurance council can order an agent to repay the money she lost. The agent should explain that a council:2.1
  151. An insurer declines to follow an ombudservice recommendation in a client's favour. The client may then:2.1
  152. A regulator audits an agent's continuing education declaration and finds the credits were never earned. The agent faces:2.1
  153. An insurer's compliance team monitors an agent whose policies lapse unusually early and often. This monitoring exists to:2.1
  154. An agent files a suspicious transaction report about a client. The agent must understand that:2.1
  155. An agent belongs to a professional association with its own code of conduct. That code:2.1
  156. A newly licensed agent asks whether errors and omissions coverage is optional. In most provinces it is:2.1
  157. A client asks why agents in different provinces answer to differently named bodies. The explanation is that:2.1
  158. A client wants to know whether an agent has ever been disciplined. Regulators normally:2.1
  159. An agent's only insurer withdraws its sponsorship of his licence. In provinces requiring sponsorship the licence will:2.1
  160. A client receives a short plain-language summary alongside a lengthy contract. The purpose of that summary is to:2.1
  161. Regulatory guidance on vulnerable clients encourages agents to collect a trusted contact person. That person may be contacted:2.1
  162. An agent suspects a client is exaggerating a disability claim. The agent should:2.1
  163. A client asks the agent to summarize who to approach if something goes wrong. The clearest answer is:2.1
  164. An agent wants to quote a satisfied client's praise in a brochure. Before doing so the agent must:2.2
  165. An agent posts on social media that a claim was paid quickly, naming the family and their circumstances. This is:2.2
  166. An agent's unlicensed assistant telephones clients to discuss which coverage they should add. This is:2.2
  167. An agent joining a new firm wants to take his client list with him. Before contacting those clients the agent should:2.2
  168. A client offers to pay her first premium in cash at the kitchen table. The agent should:2.2
  169. An agent in financial difficulty asks a long-standing client for a personal loan. This is:2.2
  170. A client cannot afford a premium and the agent offers to lend her the money personally. The agent should recognize this as:2.2
  171. A life-licensed agent is asked about general insurance for a client's home. The agent should:2.2
  172. An advertisement states that the agent is 'regulator approved'. This wording is:2.2
  173. An agent uses professional letters after her name although she never completed the program. This is:2.2
  174. An agent signs an insurer's annual compliance attestation without reading it. The agent should understand that:2.2
  175. An agent plans to operate under a business name different from his own. Before using it he must:2.2
  176. An agent stores client files on a personal cloud account shared with family members. This arrangement:2.2
  177. An agent emails a client's completed health questionnaire to an underwriter without encryption. The agent should recognize that:2.2
  178. A client asks to handle everything by text message. The agent may agree provided that:2.2
  179. An agent realizes after issue that she selected the wrong rider on a client's application. She should:2.2
  180. A client tells an agent he intends to complain to the regulator about her conduct. The agent should:2.2
  181. An insurer asks an agent to explain why so many of his clients have replaced existing policies. The agent must:2.2
  182. A needs analysis shows a client is carrying far more coverage than her circumstances require. The agent should:2.2
  183. An agent takes over the book of a retiring colleague. Toward those clients the agent should:2.2
  184. An agent whose colleague has left the firm is approached by that colleague's clients. The agent should:2.2
  185. Two products suit a client equally well, and one pays the agent substantially more. The agent should:2.2
  186. An agent offers to pay a prospective client's first premium to secure the sale. This is:2.2
  187. An agent notices that an applicant's identity document does not appear to belong to the person presenting it. The agent should:2.2
  188. An adult son insists on answering for his capable mother and discourages the agent from speaking to her alone. The agent should:2.2
  189. A client asks the agent to write to his bank confirming the value of his policies to support a loan application. The agent should:2.2
  190. An insurer's audit team asks to examine an agent's client files. The agent must:2.2
  191. An agent discovers her licence expired four days ago and she has written two applications since. She must:2.2
  192. An agent moves to a new managing general agency. Regarding existing clients the agent should:2.2
  193. An agent delivers a policy issued with a higher premium than illustrated because of a health rating. At delivery he must:2.2
  194. An agent builds his own spreadsheet projecting a policy's future values and shows it to a client. This is:2.2
  195. An agent learns that an insurer will withdraw a product in two months but has a client application in progress. The agent should:2.2
  196. An applicant refuses to answer several health questions, saying they are private. The agent must explain that:2.2
  197. A client in a hurry asks the agent to skip the needs analysis and simply sell him the largest policy available. The agent should:2.2
  198. An unlicensed acquaintance offers to send clients to an agent in return for a share of the commission. The agent should:2.2
  199. A client writes to the agent directly complaining about advice she received two years ago. The agent should:2.2
  200. A client pressing for coverage before a trip asks the agent to skip the usual documentation. The agent should:2.2
  201. An agent sells a policy to his own brother. The professional obligations that apply are:2.2
  202. A client refuses to sign anything and wants to conduct the whole relationship by telephone. The agent should:2.2
  203. An insurer asks an agent to obtain a client's consent to share information with a reinsurer. The agent should:2.2
  204. A grandmother wants a very large permanent policy on her healthy eight-year-old grandson. The agent should:2.2
  205. An employer offers to pay the premiums on a policy owned by and insuring a key employee personally. The agent should:2.2
  206. A prospective client says he will buy only if the agent guarantees the best return available. The agent should:2.2
  207. At a review an agent learns a client has divorced, changed jobs and had a child since the policy was issued. The agent should:2.2
  208. Asked to summarize the obligations owed to a client, the most complete answer is to:2.2

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