LLQP Life Insurance · Component 2.1 · 30% of the exam
A newly hired employee is told her group life coverage begins after a waiting period. This means:
- Ashe is covered from her first day but cannot make a claim during that period
- Bthe employer may extend the period indefinitely at its own discretion
- coverage starts only once she has completed the stated period of employment
- Dthe waiting period applies only to employees who work on a part-time basis
Correct answer: C) coverage starts only once she has completed the stated period of employment
A waiting period defers the start of coverage until the member has completed the eligibility requirement in the plan. A new employee is therefore uninsured under the plan until that date arrives.
Why the other options are wrong
- AThere is no coverage in force during the waiting period.
- BThe period is set in the contract rather than varied at will.
- DWaiting periods apply to the eligible classes the plan defines.
Exam tip
A waiting period means no coverage, not merely no claims.
Common mistake
Telling a new employee she is covered from her first day.
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.