LLQP Life Insurance · Component 3.3 · 25% of the exam
A client's policy is issued with an exclusion rider for a hazardous sport. Before delivery, the agent must:
- ADeliver it without comment, since the exclusion is printed in the policy and the client can read the document at their leisure
- BKeep the rider out of the delivery discussion, since drawing attention to it may cause the client to reject the policy
- CRemove the rider before delivery, since the agent has authority to adjust the insurer's offer to match the application
- Explain the exclusion, obtain the client's signed acceptance, and record that the client understood
Correct answer: D) Explain the exclusion, obtain the client's signed acceptance, and record that the client understood
An exclusion changes what was applied for; it is a counter-offer requiring acceptance. Documenting the explanation protects against a later claim that the client did not know.
Why the other options are wrong
- ADelivery without explanation fails the duty to inform.
- BConcealing contract terms is misconduct.
- CThe agent cannot remove an underwriting condition.
Exam tip
Exclusion riders are counter-offers: explain, accept in writing, document.
Common mistake
Delivering a policy with an exclusion the client never noticed.
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.