LLQP Life Insurance · Component 1.1 · 35% of the exam
A single parent with two children and no other adult in the household asks how her situation differs, for insurance purposes, from a two-parent family.
- Her death would remove the children's only income and care at once, so income replacement and a guardian arrangement need attention
- BSingle parents cannot buy life insurance, since there is no adult beneficiary to receive the proceeds
- COnly the children need to be insured, since the parent's death would be covered by government benefits
- DIt does not differ, since the needs analysis uses the same formula for every household regardless of how many adults it contains
Correct answer: A) Her death would remove the children's only income and care at once, so income replacement and a guardian arrangement need attention
With one adult, the severity of risk is at its highest: there is no second earner or caregiver. The needs analysis must fund the children's support to independence and the beneficiary structure must route money to whoever will raise them, usually through a trust.
Why the other options are wrong
- BSingle parents are insured like anyone else.
- CInsuring children does not replace a parent's income.
- DA single-parent household has no second earner; the situation differs sharply.
Exam tip
Single parent = maximum severity of risk. Pair the amount with a trustee designation so proceeds reach the children's guardian.
Common mistake
Naming minor children as beneficiaries without a trustee.
What this tests
CISRO competency component 1.1 — 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.