LLQP Life Insurance · Component 3.3 · 25% of the exam
During the underwriting period the applicant's health changes materially. The applicant must:
- Disclose the change, because the duty to disclose continues until the contract takes effect
- BCancel the application and reapply once the condition has been treated, so the new application is accurate
- CPay a higher premium automatically, since the insurer reprices every application when health changes
- DSay nothing, since the application is already signed and the insurer's decision is based on that document
Correct answer: A) Disclose the change, because the duty to disclose continues until the contract takes effect
The duty of disclosure runs to the moment coverage begins. That is also why delivery is conditional on no change in health: a policy delivered without disclosing a new diagnosis is exposed to contest.
Why the other options are wrong
- BCancelling is unnecessary; disclosure is what is required.
- CThe premium does not change automatically; the insurer must reassess.
- DThe duty to disclose continues until the contract takes effect.
Exam tip
Disclosure runs until coverage begins. A change in health after signing must be reported before delivery.
Common mistake
Delivering a policy after the client has mentioned a new diagnosis.
What this tests
CISRO competency component 3.3 — 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.