LLQP Ethics & Professional Practice · Component 2.2 · 40% of the exam
An advertisement states that the agent is 'regulator approved'. This wording is:
- Aacceptable where the agent has never been the subject of a disciplinary decision
- Bacceptable if the licence number appears immediately below the statement
- Caccurate, since holding a licence means the regulator has approved the agent's practice
- prohibited, because it implies an endorsement that no regulator gives to any agent
Correct answer: D) prohibited, because it implies an endorsement that no regulator gives to any agent
A licence confirms that entry requirements were met; it is not an endorsement of the agent or the products sold. Suggesting official approval misleads consumers and breaches the rules on deceptive practices.
Why the other options are wrong
- AA clean record does not create a regulatory endorsement.
- BA licence number does not cure the implication of endorsement.
- CLicensing is a permission to practise, not an approval of the practice.
Exam tip
A licence is permission to practise, never an endorsement.
Common mistake
Marketing a licence as though it were a seal of approval.
What this tests
CISRO competency component 2.2 — 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.