LLQP Segregated Funds & Annuities · Component 1.3 · 35% of the exam
A couple asks how to protect the surviving spouse's income. The need is addressed by:
- ASingle-life annuities on each spouse, so each has an income that does not depend on the other
- BNothing beyond the will, since the surviving spouse inherits everything in any event
- Joint-and-survivor annuities, successor annuitant designations, and tax-efficient beneficiary designations
- DNaming the children as beneficiaries, since they will look after the surviving parent
Correct answer: C) Joint-and-survivor annuities, successor annuitant designations, and tax-efficient beneficiary designations
Survivor income needs are met by joint annuity structures and spousal designations.
Why the other options are wrong
- ASingle-life annuities stop at the annuitant's death.
- BThe survivor's income need is real and inheritance through a will is slow and taxed.
- DChildren as beneficiaries bypass the spouse.
Exam tip
Survivor income → joint-and-survivor annuity, successor annuitant, spousal rollover.
Common mistake
Buying a single-life annuity for a married client without discussing the survivor.
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
Timed sets weighted like the exam, and review of every question you miss. Free to start.