LLQP Ethics & Professional Practice · Component 2.2 · 40% of the exam
An agent may accept a gift from a client:
- AOf any value, since a gift freely given by a satisfied client raises no concern about the agent's conduct
- BIncluding being named as beneficiary on the client's policy, provided the client's family has been informed
- Only of nominal value and without conflict; beneficiary, executor or attorney roles for non-family clients are prohibited
- DNever, not even a greeting card, since any gift creates the appearance of influence over the agent's advice
Correct answer: C) Only of nominal value and without conflict; beneficiary, executor or attorney roles for non-family clients are prohibited
Personal financial entanglement with clients is a serious conflict; insurers and regulators prohibit beneficiary designations and loans.
Why the other options are wrong
- AGifts are limited to nominal value.
- BBeing named beneficiary by a non-family client is prohibited.
- DNominal tokens are acceptable.
Exam tip
No beneficiary/executor/POA roles for non-family clients; no loans; nominal gifts only.
Common mistake
Accepting a beneficiary designation from an elderly client.
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.