LLQP Life Insurance · Component 3.3 · 25% of the exam
A client's application is approved but he has not paid the first premium when the policy is delivered. The agent should:
- APay the first premium himself and collect it from the client later, so the policy is in force from the date of delivery onward
- BLeave the policy with the client and collect the premium later, since the insurer has already approved the risk
- Explain that the policy is not in force until paid, collect it, and confirm health before leaving
- DCancel the application and start again, since a policy delivered without payment cannot be placed in force
Correct answer: C) Explain that the policy is not in force until paid, collect it, and confirm health before leaving
Consideration completes the contract. A policy left without payment is not in force, and a death in the interval could lead to a dispute. Agents must never pay clients' premiums.
Why the other options are wrong
- APaying a client's premium is a prohibited practice.
- BLeaving the policy unpaid creates a gap and a dispute risk.
- DThe application need not be cancelled; the premium simply must be paid.
Exam tip
No premium, no contract. Collect at delivery.
Common mistake
Assuming an approved policy is in force before payment.
What this tests
CISRO competency component 3.3 — Implement a recommendation adapted to the client's needs and situation — which is weighted at 25% of the Life Insurance module. Written against the published curriculum.
More from component 3
- At policy delivery, the agent should obtain:
- The effective date of a life insurance policy is generally:
- A pre-authorized debit form is part of implementation because:
- During implementation, the agent learns the client wants the policy owned by her corporation instead of personally, as first applied for. The correct step is:
- Which of the following is a legitimate reason an insurer might refuse to issue a policy even after favourable underwriting?
- A client's application shows the beneficiary as 'my wife' without a name. The best implementation practice is to:
Practice the whole Life Insurance module
Timed sets weighted like the exam, and review of every question you miss. Free to start.