IFSE Institute LLQP Exam With Confidence Using Practice Dumps

Akeno’s greatest financial risk upon death isIncome tax, primarily due to the capital gains taxes that would be incurred on the disposition of his non-registered investment assets and potentially his real estate properties. With significant investments and property appreciation, there may be substantial tax liabilities upon his death. Other options, such as loss of income and debt repayment, are less relevant given his financial stability and the low outstanding debt on the cottage mortgage. Estate creation is not a concern as he has sufficient assets​.

Comprehensive and Detailed In-Depth Explanation: Under the Civil Code of Quebec (Article 2415), a policyholder (or subscriber) is the entity that owns and pays for an insurance or annuity contract, which can be an individual or a legal person like a corporation. Xtra, as a company, can use its retained earnings (unregistered capital) to fund an annuity contract and be designated as the policyholder, making option D correct. Option A is false, as legal persons can own contracts (e.g., group insurance). Option B’s requirement of a registered plan is incorrect—annuities can be funded with non-registered funds. Option C introduces a “subrogated annuitant,” a misnomer here, as the annuitant is the person receiving payments, not a decision-maker, and no such requirement exists. The LLQP and Ethics manual confirm that corporations can be policyholders for business purposes, like key person coverage or investments.

Comprehensive and Detailed Explanation:

Rene’s salary is $70,000/year, and his group disability insurance provides 60% of this, or $42,000/year ($70,000 × 0.60), equating to $3,500/month ($42,000 ÷ 12). His monthly expenses are $3,500, so this just covers his needs if disabled. However, the LLQP stresses considering unexpected expenses (e.g., medical costs, inflation) beyond basic living expenses (Chapter 2:Insurance to Protect Income).

RRSP contribution: $1,000/month, savings: $45,000 (registered) + $10,000 (non-registered).

40% of salary = $70,000 × 0.40 = $28,000/year or $2,333/month.

Option A: Incorrect; $3,500/month matches expenses but leaves no buffer for unforeseen costs.

Option B: Incorrect; RRSPs are for retirement, not disability liquidity, and don’t enhanceimmediate protection.

Option C: $1,000/month additional coverage is arbitrary and insufficient for 40% of salary; it doesn’t align with needs analysis.

Option D: Correct; 40% of salary ($2,333/month) on top of $3,500 provides $5,833/month, offering a safety net for unexpected expenses, consistent with LLQP’s holistic protection approach (Chapter 6:Client Profile).