IFSE Institute Updated LLQP Exam Questions and Answers by nella

Anet worth statementassesses an individual’s total financial assets and liabilities, providing insight into their overall financial health. For Ethan, as a freelance photographer, understanding his net worth is essential to determine whether he has sufficient resources to manage unexpected expenses, such as medical costs from a potential emergency. This assessment helps Larry gauge Ethan's ability to withstand financial shocks, which is crucial when planning for accident and sickness insurance coverage​. While cash flow statements provide details on income and expenses, net worth statements are specifically used to evaluate financial resources available for emergencies.

A residual benefit in a disability insurance policy provides partial benefits if the insured returns to work in a reduced capacity and suffers a loss of income. Patricia’s income has decreased from $4,000 to $3,000, representing a 25% reduction in income ($1,000 loss out of $4,000). Since her policy provides a residual benefit, she will receive 25% of her original monthly benefit, which is25% of $2,400, amounting to $600. This is calculated to supplement her reduced earnings, aligning with the guidelines on residual benefits provided by LLQP​.

Nikolai should inform his insureras soon as he receives his diagnosis. Prompt notification is crucial as it ensures that his claim process can begin, including the assessment of eligibility, documentation, and verification. Additionally, reporting the diagnosis early helps the insurermonitor his waiting period of four months and plan for benefit payments starting at the end of this period. LLQP materials recommend early communication with the insurer to avoid delays in claim processing​.

Comprehensive and Detailed Explanation From Exact Extract:

Even when a beneficiary is irrevocable, the policyholder is allowed to accessLiving Benefits (e.g., terminal illness benefits)without the irrevocable beneficiary’s consent. These are considered advances on the death benefit. After the policyholder's death, the remainder of the death benefit goes to the beneficiary tax-free.