LLQP Segregated Funds & Annuities · Component 3.1 · 25% of the exam
A client listens to the agent's recommendation and chooses a different, more conservative option. The agent should:
- Areport the client to the insurer for having declined a professional recommendation
- implement the client's choice if it is suitable and record both the advice and the decision
- Crefuse the instruction, because the agent's recommendation is binding once it is presented
- Dimplement the choice without any note, since the file only needs to show what was purchased
Correct answer: B) implement the client's choice if it is suitable and record both the advice and the decision
The client decides. A more conservative selection is usually suitable in its own right, and the file should show what was recommended, what the client chose and the reason given, so the record is complete.
Why the other options are wrong
- AThere is nothing to report; declining advice is the client's right.
- CA recommendation is advice, not an instruction the client is obliged to follow.
- DThe file must show the advice as well as the transaction that resulted.
Exam tip
Document the recommendation and the client's decision whenever the two differ.
Common mistake
Recording only the transaction and losing the evidence of what was advised.
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.