LLQP Life Insurance · Component 2.2 · 30% of the exam
An AD&D rider differs from a plain accidental death rider in that it also:
- APays for illness that results in the loss of a limb or sight, provided the loss is permanent and certified by a specialist
- BDoubles the cash value of the base policy if the insured suffers a scheduled loss
- CWaives premiums on the base policy for the balance of the term after a scheduled loss
- Pays a scheduled benefit for accidental loss of limbs, sight, hearing or speech while the insured is alive
Correct answer: D) Pays a scheduled benefit for accidental loss of limbs, sight, hearing or speech while the insured is alive
The 'dismemberment' component pays a living benefit for specified losses, typically a percentage of the principal sum according to a schedule. Exclusions mirror those of AD coverage.
Why the other options are wrong
- AAD&D never pays for illness.
- BAD&D has no effect on cash value.
- CAD&D does not waive premiums.
Exam tip
The 'D' in AD&D is a living benefit: scheduled percentages for loss of limbs, sight, hearing, speech from an accident.
Common mistake
Forgetting that dismemberment benefits are paid while the insured is alive.
What this tests
CISRO competency component 2.2 — 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.