LLQP Segregated Funds & Annuities · Component 3.2 · 25% of the exam
A client telephones to instruct a switch between funds in her contract. The agent should:
- Adecline, because instructions affecting a contract must always be given in person
- record the instruction with the date, details and confirmation of the client's identity
- Cmake the switch and rely on the confirmation notice as the only record of the instruction
- Ddelay the switch until the client attends the office to sign a written instruction form
Correct answer: B) record the instruction with the date, details and confirmation of the client's identity
Telephone instructions are generally acceptable where the insurer permits them. The agent must confirm who is calling, note what was instructed and when, and verify that the confirmation notice later matches the instruction given.
Why the other options are wrong
- AInsurers commonly accept telephone instructions under their own procedures.
- CThe confirmation notice records what was done, not what the client asked for.
- DAn unnecessary delay exposes the client to market movement in the meantime.
Exam tip
Telephone instructions are valid but must be identified, dated and recorded.
Common mistake
Acting on a call without noting the identity check and the exact instruction.
What this tests
CISRO competency component 3.2 — 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.