LLQP Ethics & Professional Practice · Component 1.3 · 60% of the exam
A client reinstates a lapsed policy and dies by suicide eight months later. The suicide provision will generally:
- apply from the reinstatement date, so the claim may be limited to a return of premiums
- Bbe irrelevant, since suicide is never an exclusion under Canadian life insurance
- Capply only if the insurer can show the client intended suicide when reinstating
- Dnot apply, because the original policy was issued more than two years earlier
Correct answer: A) apply from the reinstatement date, so the claim may be limited to a return of premiums
Reinstatement generally restarts both the contestability and the suicide periods. A death by suicide within the restarted period is usually met with a refund of premiums rather than payment of the death benefit.
Why the other options are wrong
- BA suicide provision is standard in Canadian life insurance contracts.
- CThe provision applies by date and does not turn on proving intention.
- DThe clock restarts on reinstatement rather than running from original issue.
Exam tip
Reinstatement restarts contestability and the suicide period.
Common mistake
Measuring the suicide period from the original issue date after a reinstatement.
What this tests
CISRO competency component 1.3 — 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
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