LLQP Ethics & Professional Practice · Component 2.1 · 40% of the exam
A client holds a policy from a foreign insurer that is not an Assuris member. The agent should explain that:
- Athe provincial regulator guarantees payment where no protection plan is available
- Assuris covers policyholders of its member insurers, so this contract falls outside it
- CAssuris protection applies to every life insurance policy sold to a Canadian resident
- Ddeposit insurance steps in wherever the insurer is not a member of the protection plan
Correct answer: B) Assuris covers policyholders of its member insurers, so this contract falls outside it
Protection depends on the issuing insurer's membership. Where a contract falls outside the plan, the client relies on the insurer's own financial strength, which is a point to raise before the contract is taken out.
Why the other options are wrong
- ARegulators supervise; they do not guarantee an insurer's obligations.
- CCoverage follows membership rather than the residence of the policyholder.
- DDeposit insurance covers eligible bank deposits only.
Exam tip
Protection follows the insurer's membership, not the client's residence.
Common mistake
Assuming every policy sold in Canada carries protection plan coverage.
What this tests
CISRO competency component 2.1 — Integrate into practice the rules governing the activities of life insurance agents — which is weighted at 40% of the Ethics & Professional Practice module. Written against the published curriculum.
More from component 2
- A prospective client wants to confirm that an agent is properly licensed before meeting him. She should:
- A dual-licensed agent's mutual fund business is reviewed following a client complaint. The review will be conducted by:
- Assuris coverage applies to:
- OLHI's services are available to:
- Complaints about an agent's conduct (as opposed to an insurer's claim decision) should be directed to:
- The best summary of an agent's ethical obligations is to:
Practice the whole Ethics & Professional Practice module
Timed sets weighted like the exam, and review of every question you miss. Free to start.