LLQP Life Insurance · Component 4.1 · 10% of the exam
Which life event is most likely to require a review of a client's life insurance?
- The birth of a child, a divorce, a new mortgage or the start of a business
- BA vacation abroad, since travel outside Canada may affect the policy's coverage and the client's risk
- CA change of bank, since the pre-authorized debit must be updated and the insurer may reassess the client
- DA new car, since a more expensive vehicle increases the debt the family would face at the client's death
Correct answer: A) The birth of a child, a divorce, a new mortgage or the start of a business
The curriculum lists changes in dependants, marital status, employment or income, mortgage and business ownership as triggers for an updated needs analysis. Each changes either the need or the beneficiaries.
Why the other options are wrong
- BA vacation is not a life event for insurance purposes.
- CA change of bank has no effect on needs or beneficiaries.
- DA new car does not change life insurance needs.
Exam tip
Review triggers: dependants, marital status, employment or income, mortgage, business ownership, leaving Canada.
Common mistake
Waiting for the client to call; life changes rarely prompt clients to think of their insurance.
What this tests
CISRO competency component 4.1 — Provide customer service during the validity period of the coverage — which is weighted at 10% of the Life Insurance module. Written against the published curriculum.
More from component 4
- After a policy is reinstated, the contestability period:
- A revocable beneficiary designation is changed by:
- A client asks the agent to hold the beneficiary change form 'until next week' and dies in the meantime. The consequence is that:
- A client wants to reduce the face amount of her policy because her needs have fallen. The agent should note that:
- A client is unable to pay premiums temporarily on a whole life policy. Before letting it lapse, the agent should suggest:
- A client's term policy is being replaced with a new one from another insurer because it is cheaper and he remains healthy. To protect the client, the agent should ensure that:
Practice the whole Life Insurance module
Timed sets weighted like the exam, and review of every question you miss. Free to start.