LLQP Segregated Funds & Annuities · Component 3.1 · 25% of the exam
A 72-year-old with a RRIF, concerned about leaving assets intact for children and avoiding probate, is most suitably recommended:
- ACashing out the RRIF and gifting the proceeds to the children now, so nothing is left to probate at her death
- BHigh-yield sector funds inside the RRIF, since the death guarantee protects whatever the children will receive
- Segregated funds in the RRIF with a 100% death guarantee if available, children as beneficiaries, and a conservative mix
- DA single-life annuity with no guarantee period, since it produces the highest income for the rest of her life
Correct answer: C) Segregated funds in the RRIF with a 100% death guarantee if available, children as beneficiaries, and a conservative mix
Death guarantee plus beneficiary designation directly serves the estate objective; the mix serves the income need.
Why the other options are wrong
- ACashing out taxes the whole balance at once.
- BHigh-risk sector funds are unsuitable for a 72-year-old drawing income.
- DA straight life annuity leaves nothing to the children.
Exam tip
Estate-focused senior: death guarantee, named beneficiaries, conservative mix.
Common mistake
Not checking whether the 100% death guarantee is available at 72.
What this tests
CISRO competency component 3.1 — Implement a recommendation adapted to the client's needs and situation — which is weighted at 25% of the Segregated Funds & Annuities module. Written against the published curriculum.
More from component 3
- A client's spouse must sign for:
- When the insurer requests additional information after the application (for example, source of wealth for a large deposit), the agent should:
- The implementation of a recommendation involving a switch from one seg fund to another within a contract requires:
- A client wishes to designate a charity as beneficiary of a segregated fund. Implementation should:
- For a deferred annuity implemented for a client, the agent should confirm:
- The agent's record of the implementation should be retained:
Practice the whole Segregated Funds & Annuities module
Timed sets weighted like the exam, and review of every question you miss. Free to start.