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LLQP (Life Licence Qualification Program) Practice Exam · Question

What is the primary reason an agent must perform a 'Know Your Client' (KYC) assessment?

The 'Know Your Client' (KYC) rule is fundamental to ensuring that any recommended product is suitable for the client's specific needs, goals, and risk tolerance

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Question: What is the primary reason an agent must perform a 'Know Your Client' (KYC) assessment?

Answer options:

  • To ensure the agent earns a high commission.
  • To gather information for targeted marketing. ✅ To ensure any product recommendation is suitable for the client.
  • To comply with anti-money laundering laws only.

Correct answer: To ensure any product recommendation is suitable for the client.

Explanation: The 'Know Your Client' (KYC) rule is fundamental to ensuring that any recommended product is suitable for the client's specific needs, goals, and risk tolerance.

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