LLQP Ethics & Professional Practice · Component 2.1 · 40% of the exam
Regulatory guidance on vulnerable clients encourages agents to collect a trusted contact person. That person may be contacted:
- where the agent has concerns about the client's wellbeing or possible financial exploitation
- Bto approve any transaction the agent considers unsuitable for the client to complete
- Cto receive copies of every statement and transaction confirmation as they are produced
- Dto give instructions on the client's account when the client cannot be reached quickly
Correct answer: A) where the agent has concerns about the client's wellbeing or possible financial exploitation
A trusted contact is someone the agent may reach out to where there are concerns about capacity, undue influence or exploitation, or when the client cannot be located. They have no authority over the account.
Why the other options are wrong
- BNo third party approves transactions for a capable client.
- CRoutine documents continue to go to the client.
- DA trusted contact cannot give instructions on the client's behalf.
Exam tip
A trusted contact is a safety net, never an authority over the account.
Common mistake
Treating a trusted contact person as though they held a power of attorney.
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.