LLQP Life Insurance · Component 1.1 · 35% of the exam
A client asks the agent to skip the fact-finding and simply quote the cheapest term policy. The best response is to explain that:
- AQuotes are impossible without a medical exam, so the fact-finding must be completed before any figure can be given
- BThe regulator prohibits quoting, so the agent has no choice but to complete the full analysis first
- Without knowing dependants, obligations and existing coverage, the agent cannot know the right amount or duration
- DTerm insurance is never appropriate, so the client's request for a term quote cannot be answered as asked
Correct answer: C) Without knowing dependants, obligations and existing coverage, the agent cannot know the right amount or duration
A quote answers 'how much does X cost', not 'how much do I need and for how long'. The agent's professional obligation is to base a recommendation on the client's situation; a client who declines the analysis should at least understand what the shortcut risks.
Why the other options are wrong
- AQuotes can be produced without a medical exam; the issue is whether a quote answers the real question.
- BRegulators do not prohibit quoting; they require suitability.
- DTerm is often appropriate; its amount and duration must come from an analysis.
Exam tip
A quote tells the client what coverage costs, not how much they need. Explain the difference before giving one.
Common mistake
Letting the client's request for a quote replace the needs analysis.
What this tests
CISRO competency component 1.1 — Assess the client's needs and situation — which is weighted at 35% of the Life Insurance module. Written against the published curriculum.
More from component 1
- A client's existing policies were all sold by another agent who has left the business. The reviewing agent should:
- A client supports an adult child with a permanent disability who will never be self-sufficient. In the needs analysis this is:
- A self-employed client's income fluctuates widely year to year. When determining the income to replace, the agent should:
- A 58-year-old client plans to retire at 65 and has a pension that will pay a survivor benefit. How does time to retirement affect the life insurance need?
- Which of the following is a capital expense arising at death, rather than an ongoing income need?
- A client is the sole income earner in a household with a stay-at-home spouse and two young children. The greatest risk that life insurance on the client addresses is:
Practice the whole Life Insurance module
Timed sets weighted like the exam, and review of every question you miss. Free to start.