LLQP Ethics & Professional Practice · Component 1.4 · 60% of the exam
A client who will live abroad for three years asks whether her coverage continues. The agent should:
- Arecommend surrendering the policy now and buying replacement coverage in her destination country
- Btell her the policy terminates automatically once she ceases to reside in Canada
- check the contract's residence and travel provisions and notify the insurer of the move
- Dassure her that coverage continues worldwide without any condition or notification
Correct answer: C) check the contract's residence and travel provisions and notify the insurer of the move
Many contracts cover the insured worldwide, but some restrict certain countries or require notification, and premium payment arrangements may need changing. Checking the wording and informing the insurer avoids a dispute at claim.
Why the other options are wrong
- ASurrendering existing coverage would lose the original age and health rating.
- BCoverage does not automatically end when the insured moves abroad.
- DBlanket assurance ignores wording that may restrict certain destinations.
Exam tip
Read the residence and travel provisions before a client relocates abroad.
Common mistake
Assuring a client of worldwide coverage without reading the contract.
What this tests
CISRO competency component 1.4 — 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.