LLQP Segregated Funds & Annuities · Component 4.2 · 10% of the exam
Two relatives each claim to be the rightful beneficiary of a death benefit and ask the agent to decide. The agent should:
- Apay the benefit into a joint account so that the relatives can settle the matter privately
- Badvise the relative who was the agent's own client to consult a lawyer without telling the other
- Cdecide based on whichever designation appears most recent in the agent's own records
- explain that the insurer determines entitlement, and direct both parties to it
Correct answer: D) explain that the insurer determines entitlement, and direct both parties to it
An agent has no authority to decide entitlement and must not appear to favour one claimant. The correct role is to explain the process, supply factual information to the insurer and let the insurer or a court resolve the dispute.
Why the other options are wrong
- AAgents never handle claim proceeds, let alone place them in a joint account.
- BAdvising one side secretly creates a conflict and misleads the other claimant.
- CThe agent's records do not determine who is legally entitled to the proceeds.
Exam tip
Disputed entitlement goes to the insurer or a court, never to the agent.
Common mistake
Taking a position on which claimant should be paid.
What this tests
CISRO competency component 4.2 — Provide customer service during the validity period of the coverage — which is weighted at 10% of the Segregated Funds & Annuities module. Written against the published curriculum.
More from component 4
- A client's daughter was born last month and the client wants her added to the segregated fund designation. The agent should:
- A client wants to withdraw part of his segregated fund before maturity. The agent should explain:
- A client's segregated fund contract is approaching its maturity date. The insurer will:
- A client asks to add her adult son as a joint owner of her non-registered segregated fund contract. The agent should explain that:
- A client wants to replace the beneficiary on a contract where the current designation was made irrevocable. The agent must explain that:
- A client who has lost her job asks to pause her pre-authorized monthly contributions for six months. The agent should:
Practice the whole Segregated Funds & Annuities module
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