LLQP (Life Licence Qualification Program) Practice Exam · Question
When a life insurance agent recommends replacing an existing policy with a new one, what is a key disclosure requirement they must fulfill?
Life insurance regulations in Canada require agents to provide a detailed comparison statement to clients when recommending a replacement policy. This ensures t
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Question: When a life insurance agent recommends replacing an existing policy with a new one, what is a key disclosure requirement they must fulfill?
Answer options: ✅ Provide the client with a detailed comparison statement outlining the advantages and disadvantages of the replacement.
- Obtain a signed waiver from the client acknowledging they understand the replacement is voluntary.
- Inform the client that a replacement is always financially beneficial.
- Submit the new policy application directly to the insurer without disclosing the replacement to the existing insurer.
Correct answer: Provide the client with a detailed comparison statement outlining the advantages and disadvantages of the replacement.
Explanation: Life insurance regulations in Canada require agents to provide a detailed comparison statement to clients when recommending a replacement policy. This ensures the client understands the potential impact, including any loss of benefits or increased costs, before making a decision.
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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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