LLQP Ethics & Professional Practice · Component 1.6 · 60% of the exam
For an annuity in payment, when the annuitant dies during a guarantee period, the claim involves:
- Proof of death and the beneficiary's claim for the remaining guaranteed payments; none after the guarantee
- BNothing at all, since payments stop at the annuitant's death whether or not a guarantee period was in force
- CA refund of the premium in every case, since the guarantee period exists to return the client's capital to the estate at death
- DPayment of the remaining balance to the insurer, which retains it under the mortality pooling arrangement
Correct answer: A) Proof of death and the beneficiary's claim for the remaining guaranteed payments; none after the guarantee
An annuity claim at death concerns only guaranteed balances: payments remaining in a guarantee period or under a refund feature. After the guarantee period a single-life annuity leaves nothing to claim.
Why the other options are wrong
- BGuaranteed payments continue to the beneficiary.
- CA premium refund arises only under a refund feature.
- DAnnuity proceeds are never paid to the insurer.
Exam tip
Annuity death in guarantee period → beneficiary claims the balance.
Common mistake
Assuming an annuity has a death benefit after the guarantee period.
What this tests
CISRO competency component 1.6 — 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.