LLQP Ethics & Professional Practice · Component 1.1 · 60% of the exam
An agent licensed only in Ontario is asked to advise a long-standing client who has moved permanently to Alberta. The agent must:
- obtain a licence in Alberta before advising or transacting for the client there
- Bproceed, since the original contract was validly issued while the client lived in Ontario
- Cadvise the client only by telephone, since licensing applies to face-to-face meetings
- Dtransfer the file to the insurer, which may then advise the client without any licence
Correct answer: A) obtain a licence in Alberta before advising or transacting for the client there
Licensing follows the client's location. Advising or transacting in a province where the agent is not licensed is unlicensed activity, regardless of how long the relationship has existed or how the contact is made.
Why the other options are wrong
- BThe original contract does not extend the agent's licence into another province.
- CThe method of contact does not change where the activity takes place.
- DAn insurer cannot substitute for the licence the agent personally requires.
Exam tip
Licensing follows the client's province, not the agent's office or the policy's origin.
Common mistake
Assuming an existing client relationship survives a move across provincial lines.
What this tests
CISRO competency component 1.1 — 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.