LLQP Segregated Funds & Annuities · Component 2.3 · 30% of the exam
For a couple using locked-in pension funds to buy an annuity, pension legislation typically requires:
- A joint-and-survivor annuity with a minimum survivor percentage unless the spouse waives it in writing
- BA term-certain annuity to age 90, so that the balance passes to the spouse if the member dies first
- CNo spousal provisions, since the member alone earned the pension and may direct it freely
- DA single-life annuity on the member, with the spouse protected through a separate life insurance policy on the member
Correct answer: A) A joint-and-survivor annuity with a minimum survivor percentage unless the spouse waives it in writing
Spousal protection rules follow pension money into annuities. The waiver must be in the prescribed form.
Why the other options are wrong
- BTerm-certain is generally not permitted for locked-in funds.
- CSpousal rights apply to locked-in money.
- DSingle-life requires a spousal waiver.
Exam tip
Locked-in funds → joint-and-survivor unless spouse waives.
Common mistake
Setting up a single-life annuity from a LIF without the spousal waiver.
What this tests
CISRO competency component 2.3 — 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.