LLQP (Life Licence Qualification Program) Practice Exam · Question
What is a significant advantage of a segregated fund over a mutual fund when it comes to estate planning?
Segregated funds are insurance contracts. Therefore, if a valid beneficiary is named (specifically a 'preferred class' or irrevocable beneficiary), the fund ass
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Question: What is a significant advantage of a segregated fund over a mutual fund when it comes to estate planning?
Answer options:
- They offer higher returns than mutual funds. ✅ They provide potential protection from creditors.
- They are always tax-free upon withdrawal.
- They allow for unlimited tax-free contributions.
Correct answer: They provide potential protection from creditors.
Explanation: Segregated funds are insurance contracts. Therefore, if a valid beneficiary is named (specifically a 'preferred class' or irrevocable beneficiary), the fund assets are generally protected from the owner's creditors.
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- A life insurance policy that offers lifelong coverage, a guaranteed death benefit, and a savings component tha
- Group benefits in Canada commonly include:
- Sarah, a 35-year-old marketing professional in Ontario, purchases a participating whole life insurance policy
- Mark, a 45-year-old business owner in British Columbia, has a Universal Life policy with a Level Cost of Insur
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