LLQP Ethics & Professional Practice · Component 1.6 · 60% of the exam
A claim is denied for misrepresentation. The beneficiary's options include:
- AOnly a report to the police, since a denial based on misrepresentation is an accusation of fraud against the deceased that must be investigated
- Requesting written reasons and evidence, using the complaint process, escalating to OLHI, and suing in time
- COnly a complaint to OLHI, which has the power to overturn the insurer's decision and order payment
- DNothing, since the insurer's decision on a contestable claim is final under the terms of the contract
Correct answer: B) Requesting written reasons and evidence, using the complaint process, escalating to OLHI, and suing in time
Denials can be contested; the burden of proving material misrepresentation is the insurer's.
Why the other options are wrong
- AA denial is not a criminal matter.
- COLHI is one step in the process, not the only option, and its recommendations are non-binding.
- DA beneficiary has several options after a denial.
Exam tip
Denial: reasons → complaint → OLHI → court (within limits); insurer bears burden.
Common mistake
Accepting a denial without asking for reasons.
What this tests
CISRO competency component 1.6 — 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.