LLQP Segregated Funds & Annuities · Component 2.4 · 30% of the exam
An employer wants a retirement arrangement without sponsoring its own pension plan. The agent could describe a pooled registered pension plan as one that:
- Aguarantees each member a set monthly benefit calculated from years of service and salary
- is administered by a licensed provider, reducing the sponsor's administrative burden
- Crequires the employer to contribute at least half of each member's total annual savings
- Dallows members to withdraw their full balances in cash at any point before retirement
Correct answer: B) is administered by a licensed provider, reducing the sponsor's administrative burden
A pooled plan is run by a regulated administrator that handles investments, records and reporting. The employer may choose whether to contribute, and members are enrolled automatically with the ability to opt out within a set period.
Why the other options are wrong
- AA pooled plan is a contribution arrangement and promises no set benefit amount.
- CEmployer contributions are optional rather than fixed at a minimum share.
- DContributions are locked in and cannot simply be withdrawn before retirement.
Exam tip
A pooled plan gives small employers a pension without the administration.
Common mistake
Describing a pooled plan as though it promised a defined benefit.
What this tests
CISRO competency component 2.4 — Analyze the available products that meet the client's needs — which is weighted at 30% of the Segregated Funds & Annuities module. Written against the published curriculum.
More from component 2
- A segregated fund's 'guaranteed amount' after a partial withdrawal under proportional reduction is:
- A distinctive estate advantage of a segregated fund over a non-registered mutual fund held jointly with a child is:
- Segregated fund guarantees are most valuable relative to their cost when:
- A segregated fund's annual statement reports:
- Compared with a segregated fund, an exchange-traded fund (ETF) generally offers:
- A segregated fund's 'automatic death benefit reset' feature:
Practice the whole Segregated Funds & Annuities module
Timed sets weighted like the exam, and review of every question you miss. Free to start.