Expert Insight into the New Harmonized LLQP Program – Part Two

On January 1, 2016, the Harmonized Life Licence Qualification Program (LLQP) will come into effect. The Harmonized LLQP standardizes the entry level qualifications of new entrants to the industry across all jurisdictions in Canada (including Québec).

Ashton College Financial Services instructor Ian Whiting was one of three Ashton instructors who assisted in the creation of exam questions for the the new Harmonized LLQP certification exam. Last week we featured Becky Wong, who served as a Subject Matter Expert (SME) on ethical financial practice. This week tips, we’ll be sharing insight and feedback from Ian Whiting, a financial planner with over 30 years of experience in the industry. Ian helped to develop 25% of the questions included in the new Harmonized LLQP exam.

Why was the new harmonized LLQP introduced in Canada?

The main reason was the fractured nature of LLQP in different provinces and territories. The Financial Services industry has experienced quite a few changes in Canada over the last several years; and because of that, consistency has become even more important.

Another reason for changes was the existence of multiple course providers, and therefore the lack of unified preparation materials across the county. Each provider was allowed to have their own set of texts, which resulted in different study materials for the same provincial LLQP exam.

To achieve more consistency, CISRO (Canadian Insurance Self-Regulatory Organization) worked with all provincial and territorial insurance regulators, including Quebec, to create new, unified course material in every province and territory and in both official languages (English and French).

What are the key differences between the older version of LLQP and the new harmonized LLQP?

There are now four sets of texts, corresponding with the four study modules.

One text is on Life Insurance-related issues: what life insurance is, how it works, what can and can’t be done, taxation, beneficiaries, different policies types. This section is quite lengthy (there are around 273 pages in the textbook), but that makes sense, because it includes the fundamentals about the industry.

Another text is Ethics and Professional Practice, which is around 147 pages. This section is different in Quebec, which relies on the French civil code, as opposed to Canadian common law. In Quebec, the Ethics and Professional Practice section is close to 300 pages.

The third text is on Segregated Funds and Annuities, and includes around 235 pages.

Lastly, Accident and Sickness Insurance, which includes materials on disability, critical illness, long-term care etc. – this one is around 223 pages.

If we compare existing printing materials to the previous exam preparation materials, we can clearly see the difference. Old materials ranged from 260 pages to just below 300 for the entire course, so there is much more depth in the new texts. I believe that expanding the course materials will to raise the professional standards in the insurance industry, so that the advisors are better prepared to service their clients.

What are the main changes to the new Harmonized LLQP exam?

The most important change is the fact that one doesn’t need to simply know the materials, but also how to apply their knowledge to the client’s situation. The new exam is still multiple choice, but it requires students to think about the underlying use of the products and services, not simply memorize the textbook. When taking the exam, students may have to think about the best course of action, depending on the situational example – in other words, it is necessary to apply your critical thinking skills.

Student are also required to take a Certification Exam prior to writing the final module exams. Students are given enough time to write the exam, but they need to use that time wisely.

Furthermore, if the student thinks he/she doesn’t need to read the book to pass the test on the exam, then they are deeply, deeply mistaken. Since the exam is designed to test your ability to apply the knowledge to specific cases, you definitely need to read the materials prior to going to the exam.

After receiving a passing mark and a certificate that you passed the Certification Exam – then and only then can you sign up to write a final exam. The final consists of four marginal exams. It is computer-generated; the exam questions are randomly selected from a large bank of different questions, which is why it is very unlikely for two people across Canada to have the same exam.

The modular exams can be taken together or separately within one year. You can rewrite each module if you fail; however, the new regulations give you only three chances to re-write the exam. If you do not pass the third time, to my knowledge, you have to wait several months prior to taking it again.

In my view – and this is strictly my own opinion, which one can feel free to agree or disagree with – if somebody takes more than two attempts to pass the exam, they need to take the time to evaluate if this is the right career and industry for them.

Do you think the fact that the LLQP now takes longer to study and prepare for will make people less likely to apply?

Some people who want to get into the industry on a part-time basis may be forced to give it a second thought, just because of the amount of studying that you need to do in order to be successful. For instance, if under the old system it was enough to study about 3 hours a day, 7 days a week, with the total of 120 hours, under the new regulations, you need to triple that.

The industry has increased in complexity due to the changes in things like taxation and product design; and I am glad that the exam and study materials are starting to reflect that. I believe that longer, more extensive education for the LLQP program is a great decision.

What advice do you have for students studying for LLQP exam under the new system?

First, don’t try to take any shortcuts. Second, take your time to properly read and understand the materials. I am an advocate for extensive studying: when you get materials, read the entire material once; then read it the second time and underline the key ideas (only the key ones, not the entire textbook). Then go through the book again and write out in your own words what you understand from the key ideas you have highlighted.

If you have an opportunity to work with a mentor or take courses, I believe it’s a plus. I personally get a lot more from facilitated environments, such as discussion or study groups. You can hear different perspectives and examples of real-life situations you might not have encountered before, and learn to apply the theory to different situations.

Any tips for the instructors teaching the course?

I would advise them to forget the old material, and make sure you have done the course material and the online practice exams all the way through. In fact, my hope is that people who have the licence today would retake the new LLQP exam: as I mentioned, there are a lot of changes to the industry, and I believe that redoing the new version of the exam will be extremely beneficial to the instructors and current practitioners in the insurance industry. However, under the current regulation, there is no need for people who hold the licence to requalify.

Another piece of advice for instructors is to always relate the text materials to the real world (protecting client confidentiality, of course) – especially since the exams are focused on plausible situations.

About Ian Whiting

Ian Whiting has been a Financial Services instructor at Ashton College for over three years. Ian teaches the CFP course, the CLU course, the LLQP, and facilitates corporate training sessions for Ashton College with companies such as SunLife Financial and Investors Group.

Ian Whiting obtained his Chartered Life Underwriter (CLU) in 1987 while completing his Investment Funds Institute of Canada (IFIC) qualification. He completed his Fellowship in the Life Management Institute with a specialty in Financial Services in 1988. In 1989, Ian completed qualifications for his Chartered Financial Consultant (CFC) designation. In 1992, he qualified as an Associate of the Academy of Life Underwriters and in 1993 he completed his Associate, Customer Service designation program through LOMA.

In 1997, Ian qualified as a Certified FInancial Planner (CFP) and also completed his courses and exams to obtain the Associate, Insurance Agency Administration designation. In 1999, he completed the study and examinations to qualify as a Trading Officer, Partner and Director for Mutual Funds with the BC Securities Commission. As a result, he is also qualified as both a Branch Compliance Manager and Head Office/Provincial Compliance Officer.

The Life Licence Qualification Program

Take the LLQP at Ashton College, in partnership with IFSE, and learn from industry professionals with years of experience in their field.

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