IFSE Institute Life License Qualification Program (LLQP) - LLQP Exam Practice Test
It's Friday afternoon and Olivier, an insurance agent, has just received the paper copy of his client's insurance contract. Olivier is about to leave on a three-day weekend, and he's already late for his camping reservation.
He wonders if he should delay his departure to deliver the document, or if it can wait until he gets back on Tuesday. How long does Olivier have to deliver the contract?
He wonders if he should delay his departure to deliver the document, or if it can wait until he gets back on Tuesday. How long does Olivier have to deliver the contract?
Correct Answer: B
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Over the years, Agnes, a disciplined investor with a modest income, was able to save over $140,000 in an accumulation annuity. She plans on using the funds in a few years to travel the world and enjoy life while she is still healthy.
Which of the following statements about her annuity is TRUE?
Which of the following statements about her annuity is TRUE?
Correct Answer: A
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Samir applied for a life insurance policy 18 months ago. At the time of the application, he was employed as an accountant. Samir quit his accounting job 6 months ago to become a professional scuba diver.
Which of the following statements about Samir's life insurance policy is CORRECT?
Which of the following statements about Samir's life insurance policy is CORRECT?
Correct Answer: B
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Emma, an employee at MagicLand, is part of the company's group registered retirement savings plan (RRSP).
During her tenure, she accumulated over $70,000 in the plan and all of her contributions are invested in segregated funds. She meets with Jun to invest in an individual segregated fund. Jun tells her that there are some differences between group and individual segregated funds.
How are Emma's group segregated funds DIFFERENT from an individual segregated fund?
During her tenure, she accumulated over $70,000 in the plan and all of her contributions are invested in segregated funds. She meets with Jun to invest in an individual segregated fund. Jun tells her that there are some differences between group and individual segregated funds.
How are Emma's group segregated funds DIFFERENT from an individual segregated fund?
Correct Answer: D
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Oscar is a chartered accountant who owns and operates his own firm, Tax Time Ltd., with the help of five employees. The provincial accountants' association offers group benefits plans to its members' firms. Oscar recently contacted the association to have a group benefits plan quoted and put in place for his firm. Who will be the plan sponsor?
Correct Answer: C
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Irwin recently retired after thirty years of service with a trucking company. He has a lump sum of money in a LIRA from a prior employer that he wishes to use to purchase an annuity to cover the costs of his personal health insurance once his group coverage runs out in four months' time, when he turns 65. Although he appreciates the reduced risk an annuity provides, he would like to see the payments increase gradually over time, because he is sure the rates on his private health coverage will steadily rise in the years to come.
What type of annuity would best meet Irwin's needs?
What type of annuity would best meet Irwin's needs?
Correct Answer: D
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Christie's savings and investment assets include the following:
* RRSP: $100,000 in bond funds
* Home valued at: $400,000
* Defined benefit pension plan (DBPP) valued at: $50,000
* Chequing account: $6,000
* Savings account: $5,000
Her liabilities include:
* Credit card debt: $20,000
* Balance of mortgage: $200,000
Based on the information provided, what should Christie's priority be?
* RRSP: $100,000 in bond funds
* Home valued at: $400,000
* Defined benefit pension plan (DBPP) valued at: $50,000
* Chequing account: $6,000
* Savings account: $5,000
Her liabilities include:
* Credit card debt: $20,000
* Balance of mortgage: $200,000
Based on the information provided, what should Christie's priority be?
Correct Answer: D
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Donald is married and has two children, ages 3 and 5, one of whom is severely disabled and will never be able to live independently. He is considering buying $500,000 of life insurance to guarantee care for his disabled child for his lifetime. He also wishes to insure his 20-year mortgage of $250,000 to ensure that his family can remain in their home in the event of his death.
What life insurance policy would you recommend to Donald?
What life insurance policy would you recommend to Donald?
Correct Answer: A
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Aadi is retiring from Scotia Grand, his employer of 25 years. While employed, Aadi benefitted from the company's deferred profit sharing plan (DPSP) and over the years, he accumulated $75,000.
Where should Aadi transfer these funds on a tax-deferral basis, now that he is retired?
Where should Aadi transfer these funds on a tax-deferral basis, now that he is retired?
Correct Answer: D
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Disappointed with the performance of his current investments, Gerard wants to make changes to his portfolio.
While his investments are well diversified and professionally managed (as he requested from the outset), their value fluctuates significantly up and down. The issue is that Gerard, a professional stuntman, often puts his life on the line. Should he die, he would like the capital in his investments to be protected as much as possible-if not in whole, then at least a good portion-which is not currently the case.
What type of investment would be most suitable for Gerard?
While his investments are well diversified and professionally managed (as he requested from the outset), their value fluctuates significantly up and down. The issue is that Gerard, a professional stuntman, often puts his life on the line. Should he die, he would like the capital in his investments to be protected as much as possible-if not in whole, then at least a good portion-which is not currently the case.
What type of investment would be most suitable for Gerard?
Correct Answer: C
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Molly took out a disability insurance policy. A few years after the purchase, she severely injured her back and was unable to work. She immediately filed a claim with her insurer to start receiving benefits. The insurer asked for an attending physician's statement (APS) describing her condition and stating when that condition started. Why is it important for the insurer to know on what date Molly became disabled?
Correct Answer: A
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Agatha and Peter run a successful sole proprietorship. They are 68 and 70 respectively. Peter has a huge registered investment portfolio that will result in significant tax consequences upon his death. When both of them have passed away they would like their registered investment portfolio to go to their son, Alexander, who is 48 years old. The family would like to purchase life insurance to offset the tax liability.
Which of the following plans would best suit the family?
Which of the following plans would best suit the family?
Correct Answer: B
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Gertrude, age 52, meets with her life insurance agent so he can determine her investor profile. During the interview, the agent learns important information. Gertrude expects to live as long as her mother, who is 92 years of age. Also, Gertrude's employer has announced a series of possible layoffs in her department. Lastly, Gertrude, following a friend's advice, borrowed $50,000 to invest in an international stock portfolio a year ago.
Based on this information, which of the following personal factors is likely to have the most impact on Gertrude's risk profile?
Based on this information, which of the following personal factors is likely to have the most impact on Gertrude's risk profile?
Correct Answer: C
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(Ten years ago, Yamina invested $2,500 in a segregated fund contract with a 75%/100% guarantee structure. The market value of the contract peaked at $4,500 but then fell. Now, at maturity, the units are worth $2,250.
How much can Yamina expect to receive?)
How much can Yamina expect to receive?)
Correct Answer: D
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