LLQP Life Insurance · Component 2.1 · 30% of the exam
A group member asks who decides where his group life benefit will be paid. The answer is that:
- Athe insurer pays the member's estate in every case under a group contract
- the member names the beneficiary on the certificate, subject to any applicable restrictions
- Cthe employer designates the beneficiary from the personnel records it holds
- Dthe benefit is divided equally among the member's dependants by the plan
Correct answer: B) the member names the beneficiary on the certificate, subject to any applicable restrictions
Members name their own beneficiaries even though the employer holds the master contract. Designations are easily forgotten when circumstances change, so they should be checked at every review.
Why the other options are wrong
- AAn estate designation applies only where the member chose it.
- CThe employer administers the plan but does not choose beneficiaries.
- DNo automatic division among dependants occurs.
Exam tip
Group designations are the member's and are frequently out of date.
Common mistake
Reviewing individual designations and overlooking the group certificate.
What this tests
CISRO competency component 2.1 — Analyze the available products that meet the client's needs — which is weighted at 30% of the Life Insurance module. Written against the published curriculum.
More from component 2
- A client has a need lasting about twenty years and compares a ten-year and a twenty-year term policy. The main point to explain is that:
- A client exercises the conversion privilege on his term policy. The permanent premium will be based on:
- A client notices that a small policy costs proportionately more per unit of coverage than a larger one. The explanation is that:
- A client wants to pay monthly rather than annually. The agent should explain that monthly payment:
- A client asks why dividends from her participating policy are not taxed like interest from a bank. The reason is that a dividend is:
- A universal life policyholder is choosing among the investment options inside her policy. She should understand that:
Practice the whole Life Insurance module
Timed sets weighted like the exam, and review of every question you miss. Free to start.