LLQP Segregated Funds & Annuities · Component 1.3 · 35% of the exam
A client asks the agent to summarize the needs analysis in a single sentence. The correct summary is:
- AThe product the agent intends to recommend and the premium or deposit it requires
- BThe insurer's financial rating and the guarantee level available on the contract being proposed
- CThe largest gap the analysis identified, since that is the one the recommendation will address
- The risks identified, the resources available against them, and the gaps that remain in priority order
Correct answer: D) The risks identified, the resources available against them, and the gaps that remain in priority order
The client can only judge a recommendation against the analysis behind it, and the file needs to show that the amount proposed followed from the gaps identified.
Why the other options are wrong
- AA product without its reasoning cannot be evaluated.
- BProduct features are the answer, not the question.
- CPresenting one gap conceals the rest of the picture.
Exam tip
Risks, resources, gaps, priority.
Common mistake
Summarizing the analysis as a product recommendation.
What this tests
CISRO competency component 1.3 — Assess the client's needs and situation — which is weighted at 35% of the Segregated Funds & Annuities module. Written against the published curriculum.
More from component 1
- The first step before recommending a segregated fund or annuity is to:
- A client's 'time horizon' for an investment is:
- 'Risk tolerance' in an investor profile refers to:
- A client says he wants 'high returns with no risk of losing money'. The agent should:
- Investment objectives are commonly classified as:
- Why is the client's marginal tax rate relevant to a segregated fund recommendation?
Practice the whole Segregated Funds & Annuities module
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