Free LLQP Exam Dumps

- (Topic 2)
Mercedes is a single mother to her 5-year-old son Arthur. Arthur's father Richard is not in his son's life because he is a recovering drug dealer who spent the last 4 years in and out of prison. Mercedes has full custody of Arthur and cannot count on help from her family because they live in another province.
Wanting to ensure his well-being, in the event of her death, Mercedes purchases a $100,000 life insurance policy and names Arthur the sole beneficiary of the policy. If she died without a will who would receive the death benefit?

Correct Answer:A
Since Arthur is the named beneficiary on Mercedes' life insurance policy, the death benefit will be payable to him directly. Under LLQP provisions, life insurance proceeds designated to a minor beneficiary are generally paid into a trust or managed by a legal guardian until the minor reaches the age of majority.
In this case, because Mercedes died intestate (without a will), Arthur would still receive the
proceeds of the life insurance policy as the sole named beneficiary. However, since he is a minor, the Director of Youth Protection or a legal guardian may be appointed to manage the funds until Arthur becomes of age.

- (Topic 1)
Dr. Kumar owns a 10-year term life insurance policy with a level death benefit of $500,000 issued by Expert Health & Life Inc. The policy is renewable, convertible to age 70, and contains no additional riders. Dr. Kumar is the life insured. She is single, has no dependents, and her estate is named as the policy??s beneficiary. The current premiums are $365 per year, based on standard health, non-smoker rates. As the policy is due to renew in a few months, Dr. Kumar meets with Kavya, an insurance agent referred to her by a mutual friend. Kavya reviews all of the information presented above, but notices a missing detail.
What additional information about Dr. Kumar's policy does Kavya need to complete her review?

Correct Answer:D
The renewal of a term life insurance policy typically results in a higher premium due to the increased age of the insured. Since the policy is approaching renewal, Dr. Kumar needs to knowwhat thenew premium amountwill be. Renewal premiums are usually based on the insured??s age at renewal and are essential for decision-making regarding the affordability and continuation of the policy. Therefore,Option Dis the correct response as it highlights a critical piece of information Kavya requires to complete her review.

- (Topic 1)
Aaliyah is a 37-year-old account manager at a large pharmaceutical company. She earns $300,000 a year plus bonuses. She meets with Theo, an insurance agent, to review her life insurance needs. Theo deduces that Aaliyah needs a $250,000 universal life (UL) insurance policy. Aaliyah agrees but states that she wants to keep her premiums low. Which of the following UL death benefit options would BEST suit her needs?

Correct Answer:A
ALevel death benefitoption provides a fixed death benefit and is generally the least expensive premium option in Universal Life (UL) insurance. Since Aaliyah wants to keep her premiums low, this option best aligns with her needs. Other options like the death benefit plus account value or cumulative premiums increase the cost, as they provide a growing death benefit based on the policy??s cash value or premiums paid.Therefore,Option Awill help Aaliyah maintain lower premiums

- (Topic 3)
Wesley is a self-employed plumber. He meets with a licensed life insurance agent to explore his options regarding disability insurance. Wesley??s earnings have been stable over the past few years.His business generates gross income of $120,000 annually and write-off expenses of $30,000. Wesley??s average income tax rate is 30%. What income amount should be used to calculate the maximum disability benefits Wesley is entitled to?

Correct Answer:D
Comprehensive and Detailed Explanation:
Disability insurance benefits are calculated based onnet incomeafter business expenses and taxes, as per the LLQP guidelines, to reflect the income actually available for living expenses (Chapter 2:Insurance to Protect Income).
Gross income: $120,000 Business expenses: $30,000
Net income before tax: $120,000 - $30,000 = $90,000 Tax rate: 30%
Tax payable: $90,000 ?? 0.30 = $27,000
Net income after tax: $90,000 - $27,000 = $63,000
The maximum disability benefit is typically based on this after-tax net income, often insurable up to 60-75% depending on the policy. $63,000 is the correct base amount for calculation, aligning with standard underwriting practices.
Option A ($120,000): Incorrect; uses gross income, not net.
Option B ($90,000): Incorrect; uses pre-tax net income, ignoring tax impact. Option C ($84,000): Incorrect; no clear basis for this figure.
Option D ($63,000): Correct; reflects net income after expenses and taxes. Reference: LLQP Accident and Sickness Insurance Manual, Chapter 2:Insurance to Protect Income.

- (Topic 1)
Coraline owns a $250,000 whole life insurance policy. She purchased the policy last year and does not have any funds accumulated in her cash surrender value (CSV). On December 30, Coraline assigns the policy to the cancer foundation, and she plans on continuing to pay the $200 monthly premium. Coraline calls her accountant James to ask him how much of her donation she will be able to use to obtain a charitable tax credit this year.

Correct Answer:D
When Coraline assigns her whole life insurance policy to a charitable organization, she can claim the entire policy??s fair market value as a charitable donation for tax credit purposes, which is generally the death benefit if there is no significant accumulated cash value. Since Coraline continues to pay the premiums, the policy remains in force. Thus, she can claim the$250,000face value of the policy as her charitable donation, which is eligible for a tax credit. Monthly premium amounts (Options B and C) or a lack of CSV (Option A) do not limit her eligibility for the credit based on the policy??s value.Therefore,Option Dis correct.