LLQP Life Insurance · Component 2.2 · 30% of the exam
Two insurers' waiver of premium riders differ in how disability is defined. The definition matters most because:
- Aonly one of the two definitions is permitted under provincial insurance legislation
- an own occupation definition pays in circumstances an any occupation definition would not
- Cit determines the premium charged for the rider at the time of issue
- Dthe definition determines how long the policy itself will remain in force
Correct answer: B) an own occupation definition pays in circumstances an any occupation definition would not
An own occupation definition asks whether the insured can perform their own job, while an any occupation definition asks whether they can do any suitable work. The second is far harder to satisfy.
Why the other options are wrong
- ABoth definitions are used and permitted.
- CThe premium follows from the definition rather than determining it.
- DThe definition governs the claim, not the policy's duration.
Exam tip
Own occupation pays more readily than any occupation; compare the wording.
Common mistake
Comparing waiver riders on price without reading the definition.
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.