LLQP Life Insurance · Component 1.1 · 35% of the exam
An agent is determining the situation of a client who recently immigrated to Canada. Which factor is most likely to affect the recommendation?
- Eligibility rules and limited Canadian history may affect underwriting and available coverage
- BThe client must wait ten years before applying, since insurers require a decade of Canadian residency
- CNew immigrants cannot be insured until they obtain citizenship, so the agent should defer the recommendation
- DImmigrants pay no premium tax during their first years in Canada, which lowers the cost of coverage
Correct answer: A) Eligibility rules and limited Canadian history may affect underwriting and available coverage
Insurers have eligibility rules for newly landed immigrants and international students, and may limit amounts or require a period of residence. The curriculum lists these eligibility requirements under underwriting concepts, and the agent should know them before proposing coverage.
Why the other options are wrong
- BNo ten-year waiting rule exists; requirements vary by insurer and are usually much shorter.
- CNew immigrants can be insured; insurers apply eligibility rules and may limit amounts.
- DThere is no premium-tax exemption for immigrants.
Exam tip
Know that eligibility rules exist for newly landed immigrants and students, and check them before promising coverage.
Common mistake
Assuming residency status has no effect on what an insurer will issue.
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.