LLQP Ethics & Professional Practice · Component 1.3 · 60% of the exam
The 'suicide' provision in life insurance typically:
- AIs prohibited by the Insurance Act, since a life policy must pay on death from any cause
- BPays double the face amount for suicide, since the family suffers a greater loss
- Excludes suicide within a stated period from issue or reinstatement, with a premium refund; afterwards it pays
- DExcludes suicide for the life of the policy, since the risk is within the insured's control and cannot be priced
Correct answer: C) Excludes suicide within a stated period from issue or reinstatement, with a premium refund; afterwards it pays
The suicide clause is a contractual exclusion permitted by the Act. It restarts on reinstatement.
Why the other options are wrong
- AIt is permitted and standard.
- BNo policy pays double for suicide.
- DThe exclusion is time-limited.
Exam tip
Suicide within 2 years (issue or reinstatement): premiums refunded, no benefit.
Common mistake
Telling a family the suicide exclusion applies for the policy's life.
What this tests
CISRO competency component 1.3 — 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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