LLQP Ethics & Professional Practice · Component 2.1 · 40% of the exam
A managing general agency contracts a new agent. Its screening responsibility toward clients includes:
- Anothing, since screening is entirely the responsibility of the provincial regulator
- verifying the licence, errors and omissions coverage and the agent's background
- Ctraining the agent to the standard required for the licensing examination itself
- Dguaranteeing the agent's future conduct to every client the agent will ever serve
Correct answer: B) verifying the licence, errors and omissions coverage and the agent's background
An agency is expected to confirm that a licence is in force, that professional liability coverage exists and that the agent's history has been reviewed. It then monitors business quality and compliance on an ongoing basis.
Why the other options are wrong
- AScreening and monitoring are part of the agency's own responsibilities.
- CLicensing education is completed before the agency contract is signed.
- DNo agency can guarantee an individual's future conduct.
Exam tip
Agencies screen at contracting and monitor business quality afterward.
Common mistake
Treating agency contracting as a purely administrative step.
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.