LLQP Ethics & Professional Practice · Component 2.1 · 40% of the exam
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:
- Aforward the call to the insurer, which will negotiate the amount that must be paid
- treat it as a fraud attempt, make no payment and report it to the anti-fraud centre
- Cpay the amount requested, since regulators occasionally levy fees on benefit payments
- Dprovide her banking details so the caller can verify her identity before releasing funds
Correct answer: B) treat it as a fraud attempt, make no payment and report it to the anti-fraud centre
Regulators do not telephone consumers demanding money to release benefits. The client should make no payment, share no banking information and report the approach to the national anti-fraud centre and the police.
Why the other options are wrong
- AThere is nothing legitimate to negotiate in this situation.
- CNo regulator charges a consumer a fee to release an insurance benefit.
- DSharing banking details is exactly what the caller is seeking.
Exam tip
A demand for payment to release a benefit is always a fraud attempt.
Common mistake
Letting a client engage with a caller claiming regulatory authority.
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.