LLQP Ethics & Professional Practice · Component 1.4 · 60% of the exam
The 'ownership' provision of a policy:
- ASets the premium and the dates on which it is payable, since the owner is the person responsible for paying it
- BNames the beneficiary and any contingent beneficiary, since the owner is the person who makes the designation
- Identifies the owner and the rights of ownership, and may provide for contingent or successor ownership
- DDescribes the exclusions that apply to the owner's coverage, such as suicide and aviation
Correct answer: C) Identifies the owner and the rights of ownership, and may provide for contingent or successor ownership
The ownership provision defines who controls the contract and how control passes.
Why the other options are wrong
- APremium terms are a separate provision from ownership.
- BThe beneficiary is a separate provision.
- DExclusions are separate.
Exam tip
Ownership provision = rights of control and succession.
Common mistake
Confusing ownership and beneficiary provisions.
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
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