LLQP Life Insurance · Component 3.2 · 25% of the exam
An agent recommends a policy and the client asks for the reasons in writing. The best practice is to:
- ASend only the illustration, since the projected values show why the policy is the right one for the client
- BRefer the client to the insurer, since the insurer's underwriting file explains why the policy was issued
- CDecline, since recommendations are given verbally and a written version could be misread as a guarantee
- Provide a written summary tying the recommendation to the needs analysis, and keep a copy on file
Correct answer: D) Provide a written summary tying the recommendation to the needs analysis, and keep a copy on file
Documenting the reasons for a recommendation is a regulatory expectation and an E&O safeguard. It also gives the client something to review at the next life change, which supports the ongoing-service component of the curriculum.
Why the other options are wrong
- AThe illustration is not an explanation of suitability.
- BSuitability is the agent's responsibility, not the insurer's.
- CRecommendations should be documented, not merely verbal.
Exam tip
Written reasons tied to the needs analysis protect the client and the agent and anchor the next review.
Common mistake
Keeping no written record of why a product was recommended.
What this tests
CISRO competency component 3.2 — Implement a recommendation adapted to the client's needs and situation — which is weighted at 25% of the Life Insurance module. Written against the published curriculum.
More from component 3
- At policy delivery, the agent should obtain:
- The effective date of a life insurance policy is generally:
- A client's application is approved but he has not paid the first premium when the policy is delivered. The agent should:
- A pre-authorized debit form is part of implementation because:
- During implementation, the agent learns the client wants the policy owned by her corporation instead of personally, as first applied for. The correct step is:
- Which of the following is a legitimate reason an insurer might refuse to issue a policy even after favourable underwriting?
Practice the whole Life Insurance module
Timed sets weighted like the exam, and review of every question you miss. Free to start.