Ethics – LLQP questions with correct answers
Diana is a new life insurance agent and is studying the requirements for ascertaining the clientâs identity under the Proceeds of Crime (Money Laundering)
and Terrorist Financing Actand Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) guideline 6A.
For which of the following products must agents ascertain the clientâs identity?
1. Immediate annuity and deferred annuity
2. Exempt life insurance policy and TFSA
3. Deferred annuity and exempt life insurance policy
4. Deferred annuity and TFSA Answer ✔✔ 1. Immediate annuity and deferred annuity
Elaine and Mellie have been common law partners for the last 15 years. Elaine moved into Mellie's home 10 years ago and has been contributing to the mortgage and other household bills. She and Mellie have two children. Elaine spent four years at home wiht the kids and went back to work last year. Mellie has continued to work throughout and is their main contributor to their expenses. Elaine and Mellie separate. As common-law partners, to which of the following does Elaine have the right?
1. Elaine has the right to property division because she has been contributing to the
mortgage and household bills
2. Elaine can seek spousal support because Melli's income supports her
3. Elaine has all the same rights as someone in a married couple
4. Elaine can have Mellie sign a cohabitation agreement when they separate to retain her spousal and property rights. Answer ✔✔ 2. Elaine can seep spousal support because Mellie's income supports her. Common Law - is only eligible for spousal support
Married - can sue for spousal support and property purchased after marriage Nellie offers to add a term rider free of charge if he buys a permanent life insurance policy.
Which prohibited sales practice is Nellie using?
1. Inducing to insure
2. Trafficking in insurance
3. Premium rebating
4. Churning Answer ✔✔ 1. Inducing to insure
Roberto is a licensed life insurance agent and he has a deal with his friend Kelly-
Anne, a real estate agent, that he gives her a portion of his commission for any sale
he makes to one of the many clients she refers. This arrangement is known as which of the following?
1. Inducing to insure.
2. Premium rebating.
3. Referral arrangement.
4. Commission sharing. Answer ✔✔ 4. Commission sharing.
Nellie purchased a life insurance policy on her son Adamâs life for a face amount of $300,000. She named her husband Danny, Adamâs father, as the successor policyholder. She named Adamâs sister, Sally as the beneficiary of the policy. When Adam reached the age of majority, Nellie made an absolute assignment of the policy to him. Adam did nothing about the policy and died a few months later in a boating accident.
Who received the benefit of the policy?
1. Nellie, the former owner
2. Danny, the former successor policyholder
3. Sally, the former beneficiary 4. Adamâs estate Answer ✔✔ 4. Adamâs estate
Amy recently purchased an insurance policy that pays on her husband Sheldonâs life. The benefit is payable to their son Howard. Amy also noted on the policy that if she were to predecease Sheldon the policy should transfer to her sister Bernadette. Which of the following concerning this situation is correct?
1. Amy is the life insured.
2. Howard is the contingent beneficiary.
3. Bernadette is the successor policyholder.
4. Sheldon is the trustee. Answer ✔✔ 3. Bernadette is the successor policyholder.
* who is paying?
Calder is a member of his employerâs group insurance which includes disability coverage. Calder has some questions with regard to this policy and its provisions. Which of the following is correct?
1. Calderâs disability benefits will cover him from work related injury or disability.
2. A claim made by Calder must satisfy the definition of disability set out in his provinces insurance legislation.
3. Detailed medical evidence from a physician may be necessary to substantiate a claim.
4. Disability insurance provides coverage from disability arising only from physical impairment resulting in the inability to work. Answer ✔✔ 2. A claim made by Calder must satisfy the definition of disability set out in his provinces insurance legislation.
Carla is an insurance agent and has brokered for her client Jeremiah to sell his insurance contract to an unrelated third party. This practice is best referred to as which of the following?
1. Fronting.
Diana is a new life insurance agent and is studying the requirements for ascertaining the clientâs identity under the Proceeds of Crime (Money Laundering)
and Terrorist Financing Actand Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) guideline 6A.
For which of the following products must agents ascertain the clientâs identity?
1. Immediate annuity and deferred annuity
2. Exempt life insurance policy and TFSA
3. Deferred annuity and exempt life insurance policy
4. Deferred annuity and TFSA Answer ✔✔ 1. Immediate annuity and deferred annuity
Elaine and Mellie have been common law partners for the last 15 years. Elaine moved into Mellie's home 10 years ago and has been contributing to the mortgage and other household bills. She and Mellie have two children. Elaine spent four years at home wiht the kids and went back to work last year. Mellie has continued to work throughout and is their main contributor to their expenses. Elaine and Mellie separate. As common-law partners, to which of the following does Elaine have the right?
1. Elaine has the right to property division because she has been contributing to the
mortgage and household bills
2. Elaine can seek spousal support because Melli's income supports her
3. Elaine has all the same rights as someone in a married couple
4. Elaine can have Mellie sign a cohabitation agreement when they separate to retain her spousal and property rights. Answer ✔✔ 2. Elaine can seep spousal support because Mellie's income supports her. Common Law - is only eligible for spousal support
Married - can sue for spousal support and property purchased after marriage Nellie offers to add a term rider free of charge if he buys a permanent life insurance policy.
Which prohibited sales practice is Nellie using?
1. Inducing to insure
2. Trafficking in insurance
3. Premium rebating
4. Churning Answer ✔✔ 1. Inducing to insure
Roberto is a licensed life insurance agent and he has a deal with his friend Kelly-
Anne, a real estate agent, that he gives her a portion of his commission for any sale
he makes to one of the many clients she refers. This arrangement is known as which of the following?
1. Inducing to insure.
2. Premium rebating.
3. Referral arrangement.
4. Commission sharing. Answer ✔✔ 4. Commission sharing.
Nellie purchased a life insurance policy on her son Adamâs life for a face amount of $300,000. She named her husband Danny, Adamâs father, as the successor policyholder. She named Adamâs sister, Sally as the beneficiary of the policy. When Adam reached the age of majority, Nellie made an absolute assignment of the policy to him. Adam did nothing about the policy and died a few months later in a boating accident.
Who received the benefit of the policy?
1. Nellie, the former owner
2. Danny, the former successor policyholder
3. Sally, the former beneficiary 4. Adamâs estate Answer ✔✔ 4. Adamâs estate
Amy recently purchased an insurance policy that pays on her husband Sheldonâs life. The benefit is payable to their son Howard. Amy also noted on the policy that if she were to predecease Sheldon the policy should transfer to her sister Bernadette. Which of the following concerning this situation is correct?
1. Amy is the life insured.
2. Howard is the contingent beneficiary.
3. Bernadette is the successor policyholder.
4. Sheldon is the trustee. Answer ✔✔ 3. Bernadette is the successor policyholder.
* who is paying?
Calder is a member of his employerâs group insurance which includes disability coverage. Calder has some questions with regard to this policy and its provisions. Which of the following is correct?
1. Calderâs disability benefits will cover him from work related injury or disability.
2. A claim made by Calder must satisfy the definition of disability set out in his provinces insurance legislation.
3. Detailed medical evidence from a physician may be necessary to substantiate a claim.
4. Disability insurance provides coverage from disability arising only from physical impairment resulting in the inability to work. Answer ✔✔ 2. A claim made by Calder must satisfy the definition of disability set out in his provinces insurance legislation.
Carla is an insurance agent and has brokered for her client Jeremiah to sell his insurance contract to an unrelated third party. This practice is best referred to as which of the following?
1. Fronting.
