LLQP Ethics & Professional Practice · Component 2.1 · 40% of the exam
The requirement that insurers provide 'plain-language' policy summaries or key facts documents protects clients by:
- ANothing beyond convenience, since a client who wants to understand the coverage must still read the full contract
- Giving consumers an accessible overview of coverage, exclusions, costs and rights to support informed decisions
- CReplacing the contract, so that any inconsistency between the summary and the policy is resolved in favour of the summary
- DEliminating the agent's duty to explain the product, since the document does the explaining on the agent's behalf
Correct answer: B) Giving consumers an accessible overview of coverage, exclusions, costs and rights to support informed decisions
Disclosure documents supplement, not replace, the agent's duty to explain.
Why the other options are wrong
- APlain-language summaries are a real client protection.
- CThe contract governs.
- DThe agent must still explain.
Exam tip
Summaries help; the agent still explains; the contract governs.
Common mistake
Handing over documents without explanation.
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.