LLQP Ethics & Professional Practice · Component 1.5 · 60% of the exam
An employee names a beneficiary on her group life certificate and also has an individual policy. She should understand that:
- Athe group designation automatically overrides the individual policy designation
- Bone designation covers both contracts because both are life insurance on her own life
- each contract requires its own designation, which should be reviewed separately
- Dthe employer decides who receives the group benefit regardless of what she records
Correct answer: C) each contract requires its own designation, which should be reviewed separately
Designations operate contract by contract. Group coverage often changes with employment and is easy to overlook, so a review should cover every contract the client holds rather than only the individual policy.
Why the other options are wrong
- ANeither designation overrides the other; they are independent.
- BA designation applies only to the contract on which it is recorded.
- DThe certificate holder names the beneficiary, not the employer.
Exam tip
Review every contract's designation, including group certificates.
Common mistake
Updating an individual policy and forgetting the group certificate.
What this tests
CISRO competency component 1.5 — 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.