LLQP Life Insurance · Component 2.2 · 30% of the exam
Which rider is designed for a juvenile policy where the parent, not the child, pays the premiums?
- AAccidental death on the child, which pays the parent an additional amount if the child dies as the result of an accident
- BWaiver of premium on the child, which waives the premium if the child becomes disabled before reaching adulthood
- CGuaranteed insurability on the parent, which lets the parent buy more coverage on the child at each option date
- Payor waiver, which waives premiums if the paying parent dies or becomes disabled
Correct answer: D) Payor waiver, which waives premiums if the paying parent dies or becomes disabled
The risk to a child's policy is the payor's inability to pay. Payor waiver targets exactly that, keeping the policy in force until the child can take it over.
Why the other options are wrong
- AAD adds a benefit; it does not protect premiums.
- BThe child is not the payor.
- CGIB on the parent has nothing to do with the child's policy.
Exam tip
Juvenile policies: payor waiver protects against the parent's death or disability.
Common mistake
Attaching a standard waiver of premium (on the insured child) instead of a payor waiver.
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.