LLQP Ethics & Professional Practice · Component 1.5 · 60% of the exam
A beneficiary designation made in a 'will':
- Is valid if it identifies the contract, but is revoked with the will, and a later declaration prevails
- BRequires the agent's approval before the insurer will recognize it, since the agent must confirm suitability
- CIs invalid, since the Act requires every designation to be made on the insurer's own form
- DAlways overrides the policy designation, since a will is the most recent statement of the owner's wishes
Correct answer: A) Is valid if it identifies the contract, but is revoked with the will, and a later declaration prevails
Will designations are permitted but fragile: revocation of the will revokes the designation, and insurers pay per their records until notified.
Why the other options are wrong
- BAn agent's approval is not required for a will designation.
- CA will designation is permitted by the Act.
- DLater declarations prevail, and the will's revocation undoes it.
Exam tip
Will designations work but are revoked with the will; notify the insurer.
Common mistake
Relying on a will to change a policy beneficiary without notifying the insurer.
What this tests
CISRO competency component 1.5 — Integrate into practice the legal aspects of insurance and annuity contracts — which is weighted at 60% of the Ethics & Professional Practice module. Written against the published curriculum.
More from component 1
- An 'assignee' of a life insurance policy is:
- A corporation as policyowner and beneficiary of a policy on a key employee:
- A 'trustee' named to receive proceeds on behalf of a beneficiary:
- The 'automatic premium loan' (APL) provision:
- A life insurance contract 'matures' when:
- The 'assignment' provision typically states that:
Practice the whole Ethics & Professional Practice module
Timed sets weighted like the exam, and review of every question you miss. Free to start.