LLQP Ethics & Professional Practice · Component 1.4 · 60% of the exam
The 'legal actions' provision in life insurance:
- AProhibits lawsuits against the insurer, since disputes must be resolved through the OLHI complaint process
- Requires any action against the insurer to be started within the limitation period set by statute
- CSets no time limit, since a beneficiary's right to the proceeds cannot be lost through delay
- DRequires arbitration before any court action, so the beneficiary must first accept an arbitrator's award
Correct answer: B) Requires any action against the insurer to be started within the limitation period set by statute
Limitation periods bar late claims; agents should tell claimants about them.
Why the other options are wrong
- ALawsuits are allowed within the period.
- CLimitation periods apply.
- DArbitration is not mandated.
Exam tip
Sue within the limitation period or lose the right.
Common mistake
Letting a denied claim sit past the limitation period.
What this tests
CISRO competency component 1.4 — 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.