LLQP Segregated Funds & Annuities · Component 3.2 · 25% of the exam
An agent is implementing a transfer of locked-in pension money into a life income fund for a married client. The implementation will normally require:
- Aa letter from the employer confirming that the member left on good terms
- a waiver signed by the spouse in the prescribed form, where the legislation requires one
- Cthe consent of the adult children who are named as beneficiaries of the account
- Dnothing beyond the client's own signature, since the money already belongs to the client
Correct answer: B) a waiver signed by the spouse in the prescribed form, where the legislation requires one
Pension legislation protects a spouse's entitlement to survivor benefits. Where a waiver is required, it must be signed in the prescribed form and within the prescribed time, or the transfer cannot be completed as instructed.
Why the other options are wrong
- AThe circumstances of the departure have no bearing on the transfer.
- CBeneficiaries have no right to consent to a transfer during the member's lifetime.
- DA spouse may have a statutory entitlement that the member cannot simply override.
Exam tip
Locked-in money plus a spouse equals check for a prescribed waiver requirement.
Common mistake
Processing a locked-in transfer without checking the spousal entitlement.
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
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