LLQP Life Insurance · Component 3.2 · 25% of the exam
A client's budget covers only part of the recommended coverage. A sound way to present the recommendation is to:
- Apresent only what the budget allows and omit the shortfall from the discussion
- Breduce every element proportionately so the plan looks complete on paper
- Crecommend borrowing the difference from a lender so the full amount can be placed immediately
- prioritize the most serious risk now and set out a staged plan to add coverage later
Correct answer: D) prioritize the most serious risk now and set out a staged plan to add coverage later
Protecting the largest exposure first does the most good, and a staged plan with review dates keeps the rest in view. The shortfall should be stated clearly so the client understands what remains uncovered.
Why the other options are wrong
- AOmitting the shortfall denies the client the information to decide.
- BScaling everything down can leave every risk inadequately covered.
- CBorrowing to fund premiums creates a new and fragile obligation.
Exam tip
Cover the biggest exposure first and document the remaining gap.
Common mistake
Trimming every component instead of prioritizing the biggest risk.
What this tests
CISRO competency component 3.2 — 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.