LLQP Life Insurance · Component 2.1 · 30% of the exam
When a group member converts group life to an individual policy on leaving the employer, the individual policy is typically:
- A permanent or term policy at individual rates for the attained age, without evidence
- BTerm insurance at the group rate, since the member has been part of the group and is entitled to its pricing for a further period
- CFree of premium for the first year, since the employer's contributions are transferred to the individual policy
- DAvailable for two years after termination, giving the member time to compare quotes from other insurers
Correct answer: A) A permanent or term policy at individual rates for the attained age, without evidence
Conversion is priced at attained age and individual rates, which are higher than the group rate, and is capped at the coverage lost. Its value is the absence of underwriting — decisive for a member in poor health.
Why the other options are wrong
- BConversion is at individual rates, not group rates.
- CConverted coverage carries a premium.
- DThe window is typically a matter of weeks, not years.
Exam tip
Conversion: no evidence, individual rates, attained age, capped at coverage lost, short deadline.
Common mistake
Telling a departing employee they can convert whenever they like.
What this tests
CISRO competency component 2.1 — 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.