LLQP Life Insurance · Component 3.3 · 25% of the exam
A client's application shows the beneficiary as 'my wife' without a name. The best implementation practice is to:
- AName the agent as beneficiary in trust for the wife, so the proceeds can be paid quickly without the need to identify her at claim
- BLeave the designation as written, since the insurer will identify the wife from the marriage certificate at claim
- Record the beneficiary by full legal name and relationship to avoid any ambiguity
- DName the estate instead, so the will can identify the wife and direct the proceeds to her
Correct answer: C) Record the beneficiary by full legal name and relationship to avoid any ambiguity
Class designations like 'my wife' can be ambiguous after divorce and remarriage. Naming individuals precisely avoids disputes at claim time. This is a common correction at implementation.
Why the other options are wrong
- ANaming the agent would be a serious ethical breach.
- BAmbiguous designations cause claim disputes.
- DThe estate is the wrong beneficiary here.
Exam tip
Beneficiaries by full name and relationship; avoid bare class descriptions.
Common mistake
Accepting 'spouse' or 'children' as a complete designation.
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 client's application is approved but he has not paid the first premium when the policy is delivered. The agent should:
- 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?
Practice the whole Life Insurance module
Timed sets weighted like the exam, and review of every question you miss. Free to start.