LLQP Life Insurance · Component 2.1 · 30% of the exam
A client exercises the conversion privilege on his term policy. The permanent premium will be based on:
- Aan average of his original issue age and his age at the date of conversion
- his attained age at conversion, without any new evidence of insurability
- Cthe age at which the term policy was originally issued to the client
- Dhis current health, assessed through a fresh medical examination
Correct answer: B) his attained age at conversion, without any new evidence of insurability
Conversion uses the insured's age at the time of the change, applying the insurer's standard rates for the permanent product. The value lies in avoiding underwriting, not in preserving the original age.
Why the other options are wrong
- ANo averaging of ages is applied on conversion.
- CPremiums are set at attained age rather than the original issue age.
- DConversion is exercised without evidence of insurability.
Exam tip
Conversion keeps the underwriting class, not the original age.
Common mistake
Promising a client the original issue age on conversion.
What this tests
CISRO competency component 2.1 — Analyze the available products that meet the client's needs — which is weighted at 30% of the Life Insurance module. Written against the published curriculum.
More from component 2
- A client has a need lasting about twenty years and compares a ten-year and a twenty-year term policy. The main point to explain is that:
- A client notices that a small policy costs proportionately more per unit of coverage than a larger one. The explanation is that:
- A client wants to pay monthly rather than annually. The agent should explain that monthly payment:
- A client asks why dividends from her participating policy are not taxed like interest from a bank. The reason is that a dividend is:
- A universal life policyholder is choosing among the investment options inside her policy. She should understand that:
- A client takes a partial withdrawal from the fund of his universal life policy. The tax consequence is that:
Practice the whole Life Insurance module
Timed sets weighted like the exam, and review of every question you miss. Free to start.