LLQP Ethics & Professional Practice · Component 2.2 · 40% of the exam
An agent learns that an insurer will withdraw a product in two months but has a client application in progress. The agent should:
- Asay nothing, because the client's contract will be issued before the product is withdrawn
- Bcomplete the sale quickly and raise the change only at the following annual review
- tell the client, since the withdrawal may affect future options such as added coverage
- Dwithdraw the application and start again with a different insurer's product
Correct answer: C) tell the client, since the withdrawal may affect future options such as added coverage
A client is entitled to material information about what is being bought, including whether the product will remain available for future increases or additions. The client then decides with the full picture.
Why the other options are wrong
- AIssuance before withdrawal does not address the effect on future options.
- BDelaying disclosure denies the client the chance to decide.
- DWithdrawing an application the client wants is not the agent's decision.
Exam tip
Material information about the product belongs to the client now, not later.
Common mistake
Withholding product news to avoid disturbing a sale in progress.
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.