LLQP Life Insurance · Component 1.2 · 35% of the exam
A client's spouse died last year. The client is receiving a CPP survivor's pension and asks whether it will change when she starts her own CPP retirement pension. The agent should explain:
- AThe survivor's pension stops entirely once she begins her own retirement pension, since CPP pays only one benefit per person
- BThe two are simply added together with no limit, since each was earned on a different contributor's record
- CHer own pension is cancelled and the survivor's pension continues, since the survivor's pension is the larger of the two
- The survivor's pension and her own pension are combined and subject to a maximum, so she may receive less than the sum
Correct answer: D) The survivor's pension and her own pension are combined and subject to a maximum, so she may receive less than the sum
CPP combines survivor and retirement pensions under a combined-benefit maximum. A survivor with a full retirement pension of their own may see the survivor portion reduced. This affects the resources side of the survivor's own planning.
Why the other options are wrong
- AThe survivor's pension does not stop; it may be reduced.
- BA combined maximum applies.
- CHer own pension is not cancelled.
Exam tip
CPP survivor + own retirement pension = combined benefit with a maximum. Do not simply add them.
Common mistake
Projecting a survivor's income by adding both pensions in full.
What this tests
CISRO competency component 1.2 — 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.