LLQP Ethics & Professional Practice · Component 2.2 · 40% of the exam
An agent learns after delivery that the client omitted a material health fact on the application. The agent should:
- Advise the client to disclose immediately, explaining that correction now beats a denied claim later
- BCancel the policy personally on the client's behalf, since a policy issued on incomplete information cannot stand
- CSay nothing, since the application has been accepted and raising the matter would only jeopardize the client's coverage
- DAlter the application to include the fact and resubmit it, so the insurer's file is accurate without involving the client
Correct answer: A) Advise the client to disclose immediately, explaining that correction now beats a denied claim later
The agent's duty of good faith to the insurer and duty of care to the client both point to disclosure.
Why the other options are wrong
- BCancellation is not the agent's decision.
- CConcealment breaches the agent's duties.
- DAltering the application is forgery.
Exam tip
Post-issue discovery of non-disclosure → advise disclosure to the insurer.
Common mistake
Keeping quiet to preserve the sale.
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.