LLQP Life Insurance · Component 1.3 · 35% of the exam
A client's needs analysis shows a large temporary need with a small permanent tail. She insists on buying only permanent insurance for the full amount. The agent should:
- Explain the cost difference and mismatch, offer the layered alternative, and document her choice
- BRefuse to sell her anything at all, since a client who rejects the recommended structure cannot be served suitably by any agent
- CComply without comment, since the client has stated her preference and the agent's role is to process the sale she wants
- DSell term only, since the analysis shows the need is mainly temporary and the agent must follow the analysis
Correct answer: A) Explain the cost difference and mismatch, offer the layered alternative, and document her choice
The client decides; the agent informs. A client who understands the trade-off and can afford the premium may legitimately prefer permanent coverage. The file should show the analysis, the alternative offered and the client's choice.
Why the other options are wrong
- BRefusing an informed, affordable choice is not the agent's role.
- CComplying without explanation fails the duty to inform.
- DOverriding the client's choice is not the agent's role either.
Exam tip
Inform, recommend, document. The client's informed choice can differ from the recommendation.
Common mistake
Either steamrolling the client or abandoning the analysis when the client disagrees.
What this tests
CISRO competency component 1.3 — 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.