LLQP Ethics & Professional Practice · Component 1.2 · 60% of the exam
A grandmother applies for a policy on her infant grandchild's life. The requirements include:
- Anothing beyond her own signature, since an infant cannot give any form of consent
- Ba court order approving the contract because the life insured is under the age of majority
- Cthe child's own signature, witnessed by a parent, on the application form
- the consent of a parent or guardian, along with the insurable interest she already holds
Correct answer: D) the consent of a parent or guardian, along with the insurable interest she already holds
Where the life insured is a minor, the parent or guardian consents on the child's behalf. The grandparent's family relationship supplies the insurable interest required at the time the contract is made.
Why the other options are wrong
- AConsent is still needed, given by the parent or guardian.
- BNo court order is required for an ordinary policy on a child's life.
- CAn infant cannot sign, which is why a guardian consents.
Exam tip
Minor life insured equals parental or guardian consent, not a court order.
Common mistake
Issuing on a child's life without the parent or guardian's consent.
What this tests
CISRO competency component 1.2 — 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.