LLQP Segregated Funds & Annuities · Component 3.1 · 25% of the exam
The written recommendation should document:
- ANothing in writing, since the signed application and the insurer's contract are the only records that matter
- BOnly the premium and the fund selected, since the rest of the reasoning is in the agent's head if ever needed
- The profile and needs, design choices with reasons, guarantee limits, fees, tax, alternatives, risks and any client departures
- DOnly the product code and the guarantee level, since the insurer's file holds everything else
Correct answer: C) The profile and needs, design choices with reasons, guarantee limits, fees, tax, alternatives, risks and any client departures
Documentation is the suitability record and the defence against complaints.
Why the other options are wrong
- AA written recommendation record is required for suitability.
- BPremium alone is inadequate.
- DCodes explain nothing about why the product was chosen.
Exam tip
Recommendation file: profile → design → reasons → limits → alternatives → client choices.
Common mistake
No record of alternatives considered.
What this tests
CISRO competency component 3.1 — 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.