LLQP Life Insurance · Component 4.1 · 10% of the exam
A client asks the agent to hold the beneficiary change form 'until next week' and dies in the meantime. The consequence is that:
- The change is not effective because it was never filed; the previous designation governs
- BThe change is effective from the date the client signed it, since the client's intention was clear and had been documented in writing
- CThe proceeds are split between the old and new beneficiaries, since the insurer cannot determine which designation governs
- DThe agent may file the form retroactively, since the client signed it before death and the delay was the agent's
Correct answer: A) The change is not effective because it was never filed; the previous designation governs
Filing is what makes a designation effective. Holding forms exposes the agent to liability and the client's wishes to defeat. Submit designation changes the day they are signed.
Why the other options are wrong
- BUnfiled changes are ineffective.
- CProceeds go to the beneficiary on file.
- DBackdating a filing is fraud.
Exam tip
Never hold a signed designation change; file it immediately.
Common mistake
Batching client paperwork for later submission.
What this tests
CISRO competency component 4.1 — Provide customer service during the validity period of the coverage — which is weighted at 10% of the Life Insurance module. Written against the published curriculum.
More from component 4
- After a policy is reinstated, the contestability period:
- A revocable beneficiary designation is changed by:
- A client wants to reduce the face amount of her policy because her needs have fallen. The agent should note that:
- A client is unable to pay premiums temporarily on a whole life policy. Before letting it lapse, the agent should suggest:
- A client's term policy is being replaced with a new one from another insurer because it is cheaper and he remains healthy. To protect the client, the agent should ensure that:
- The primary purpose of a periodic policy review is to:
Practice the whole Life Insurance module
Timed sets weighted like the exam, and review of every question you miss. Free to start.