State RegulationsIL specificDifficulty 2/5
A producer shows a client a life insurance illustration in Illinois projecting future policy values. Under 50 Ill. Adm. Code 1406, which practice is prohibited?
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Answer & full 3-part explanation (select an option above, or peek)
Why C is correct
50 Ill. Adm. Code 1406 regulates illustrations precisely because projections of non-guaranteed elements can mislead buyers. The rule prohibits presenting non-guaranteed values in a manner that implies they are guaranteed or certain, so a producer who lets a client read projections as promises violates the Illinois Department of Insurance's illustration standards even if the numbers themselves are accurate.
Why the other options are wrong
- A) Illustrations exist to show values, including projections; the violation is misleading presentation, not the mere presence of numbers.
- B) Explaining how dividends and credits are determined is proper disclosure consistent with the purpose of 50 Ill. Adm. Code 1406.
- D) Giving the client a copy of the illustration supports the disclosure goals of the Illinois Department of Insurance rules rather than conflicting with them.
Memory hook
Show the projection, never promise it.