Free LLQP: Life License Qualification Program Exam Questions and Answers
150 verified practice questions for LLQP.
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Last updated: September 19, 2026
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- LLQP
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Question #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?
Please select an optionIncorrectCorrect 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
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Svetlana is a 45-year-old single mother with two children: Georgi 17; and Ingrid 13. The children's father, Vladimir, has a serious gambling problem and only visits them sporadically. Vladimir's younger brother Sergei, on the other hand, is a dependable and helpful uncle who helps Svetlana regularly with the children. Svetlana meets with Robert, an insurance agent to review her life insurance needs because she wants to make sure that her children are taken care of if she were to die prematurely. Robert suggests that she purchase a $200,000 policy. Who should she name as a beneficiary?
Please select an optionIncorrectCorrect answer: B
Since Svetlana's children are minors, naming them directly as beneficiaries would require appointing a trustee to manage the funds until they reach the age of majority. Given that Vladimir is unreliable,Sergei—who is dependable and supportive—is the most suitable choice to act as trustee. Naming him as trustee ensures that the funds are managed responsibly for thebenefit of Georgi and Ingrid until they can access them.Therefore,Option Bis the most appropriate choice.
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Akeno is a 65-year-old retired accountant. He is divorced and has a 40-year-old son who is financially independent. Thanks to years of diligent savings, Akeno now enjoys a comfortable retirement. In addition to his pension income, he has over $300,000 invested in shares in his non-registered account. He lives in a mortgage- free home valued at $700,000 and owns a cottage valued at $500,000. The mortgage on the cottage is $100,000. Akeno purchased the homes 30 years ago when housing prices were low. It is important to him to donate $100,000 to the Alzheimer's Association when he dies. What is the GREATEST financial risk that would arise in the event of Akeno's death?
Please select an optionIncorrectCorrect answer: C
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 potentiallyhis 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.
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Anita is a 50-year-old woman who is thinking of purchasing a $150,000 permanent life insurance policy to pay for the capital gains tax that will be payable on her country home upon her death. She had purchased the home twelve years ago and wants to bequeath the property to her niece when she dies. Which of the following features about a permanent insurance policy is TRUE?
Please select an optionIncorrectCorrect answer: B
Permanent life insurance policies generally offerlevel premiumsfor the duration of the contract, meaning that Anita's premium payments will not increase as she ages. While coverage can be structured to extend beyond age 100, many permanent policies maintain level premiums for the policyholder's lifetime. Unlike term insurance, Anita can also cancel the policy at any time. However, insurability changes do not typically affect existing permanent policies, which don't require updates to health information once the policy is in force.Therefore,Option Bis correct.
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Jasper owns TeleVida, a successful production company with over 50 employees. He wants to expand the company by opening an office in another province. Jasper needs to take out a $500,000 20-year loan to make this expansion happen. However, he wants to make sure that if hedies while there's an outstanding balance on the loan, the balance will be paid in full by the insurance company.
Please select an optionIncorrectCorrect answer: A
In this case, Jasper is concerned with covering a specific loan balance that will decrease over time as the loan is repaid. A20-year decreasing term life insurancepolicy is typically used for situations where the coverage amount decreases over the policy term, aligning with the declining balance of a loan. This is often the most cost-effective option, as the coverage amount decreases in line with the outstanding loan balance, ensuring that the insurance will pay off any remaining loan balance if Jasper dies within the 20-year term. Other options, such as a standard term policy with a level benefit (Option B), a Term-100 (Option C), or a Universal Life policy (Option D), provide level or flexible coverage not specifically suited to decreasing liabilities like a loan. Therefore,Option Ais the best choice to meet Jasper's needs cost-effectively.
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Harold is a 66-year-old retired school bus mechanic. He receives $900 a month from his defined benefit pension plan (DBPP). His husband Karl is also retired and receives his own pension benefit. Harold would like to know the minimum monthly pension benefit from his DBPP that Karl will receive upon Harold's death.
Please select an optionIncorrectCorrect answer: C
Defined Benefit Pension Plans (DBPPs) provide a guaranteed income stream to the plan member after retirement, based on a formula considering factors like years of service and salary history. Generally, unless explicitly set up with survivor benefits, DBPPs do not automatically transfer income to a surviving spouse upon the member's death. In Harold's case, if no survivor benefit option was selected during retirement setup, Karl would not receive any income from Harold's DBPP. Therefore, the correct answer isA. $0as no automatic provision ensures Karl receives benefits unless Harold had chosen and paid for survivor benefits.
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Konrad is the owner of CrossBoy, a manufacturing company employing over 50 employees. Konrad recently took out a $500,000 loan to expand his business. Terrence works as a sales manager and is responsible for roughly 40% of the company's revenue. Konrad recognizes the importance of Terrence's contributions to the success of the company. Therefore, in addition to a sizeable basesalary, CrossBoy also pays Terrence regular performance-based bonuses. Konrad understands that if Terrence dies prematurely, CrossBoy would suffer financially. What should he do to protect his company?
Please select an optionIncorrectCorrect answer: C
Key person life insurance is designed to protect a business from financial losses resulting from the death of a key employee. In this case, Terrence's role is crucial to CrossBoy's success due to his substantial contribution to the company's revenue. By purchasing key person insurance on Terrence, Konrad can ensure that the company has the necessary funds to cover the financial impact of Terrence's potential loss. Other options, like offering a group life insurance plan (A), do not directly address the specific financial risk associated with the loss of a key employee.Therefore,Option Cis the appropriate choice.
Was this answer correct?Question #8
Ten years ago, Anastasia purchased a $125,000 10-year term renewable life insurance policy. Her insurance need has not changed, and she is still in good health. She asks her insurance agent Raphael what she should do.
Please select an optionIncorrectCorrect answer: B
Term life insurance policies typically allow for renewal at the end of the term, but the premium is recalculated based on the policyholder's age at renewal. Since Anastasia's policy is a 10-year term, and she is now renewing it, her premiums will be higher due to her increased age, despite her good health. The policy will renew without medical underwriting, but it will be at an increased rate. Option A is incorrect, as the rate cannot remain the same. Option C, restarting the incontestability period, may happen but is unrelated to the premium question.Option D, shopping for a better rate, is an option but not directly tied to renewal.Therefore,Option Bis correct.
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Bethenny meets with Harrison, an insurance agent, to review her life insurance needs. Bethenny is a single mother of a 3-year-old daughter named Emma. Bethenny's main concern is that Emma istaken care of financially if Bethenny were to die prematurely. Emma's father Steve suffers from chronic alcoholism and is homeless. He has not been present in Emma's day-to-day life. After careful analysis, Harrison suggests that Bethenny purchase a $250,000 20-year term insurance policy. Given Bethenny's situation, who should she name as a beneficiary on her policy?
Please select an optionIncorrectCorrect answer: C
Since Emma is a minor, naming her directly as a beneficiary would complicate access to funds until she reaches the age of majority. Additionally, Steve, given his circumstances, would not be a suitable option. Instead,naming a trusteefor Emma's benefit would ensure that the funds are managed responsibly until she is of legal age to handle the inheritance. This setup aligns with Bethenny's intention to provide financial security for Emma, allowing a trusted adult to manage the funds in Emma's best interests.
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Six years ago, when Kacey was working as an active firefighter, she purchased a $200,000 30-year term life insurance policy. At the time, the insurance company rated her policy. Recently, she changed roles and now works for the fire department's public relations office, answering media calls and filling out paperwork. She meets with her insurance agent, Bernice, to ask if the insurer would consider reducing her premiums.
Please select an optionIncorrectCorrect answer: B
When a term life insurance policy is issued with a specific rating based on risk factors, such as Kacey's former occupation as a firefighter, the premiums are generally fixed and non- negotiable post-issuance. However, Kacey can apply for a new policy, which would consider her current lower-risk occupation and potentially offer lower premiums. She would need to undergo underwriting again. Thus,Option Bis correct, as the existing policy's premiums cannot be adjusted retroactively to account for her new role.
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