LLQP Ethics & Professional Practice · Component 2.1 · 40% of the exam
An agent suspects a client is exaggerating a disability claim. The agent should:
- Arefuse to submit the claim and close the client's file without further explanation
- report the concern to the insurer, which investigates claims and decides on them
- Csubmit the claim without comment, since claim assessment is not the agent's concern
- Dconfront the client and warn that the claim will be reported to the police immediately
Correct answer: B) report the concern to the insurer, which investigates claims and decides on them
The agent does not adjudicate claims but must not participate in a false one. Raising the concern with the insurer, which has the investigative role, is the correct course and should be documented.
Why the other options are wrong
- AClosing the file without explanation abandons the client and resolves nothing.
- CSuspicion of a false claim cannot simply be ignored.
- DConfronting and threatening the client is neither accurate nor appropriate.
Exam tip
Raise claim concerns with the insurer; do not investigate or adjudicate.
Common mistake
Either confronting the client or passing on a claim believed to be false.
What this tests
CISRO competency component 2.1 — 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.