Underwrite financial risk in a life insurance policy
This unit describes the skills and knowledge required to assess applications for a life insurance policy to identify and underwrite associated financial risks.
The unit applies to individuals who use specialised knowledge to determine financial risk, within a level of delegated authority, and to complete underwriting functions in the life insurance industry.
No licensing, legislative or certification requirements apply to this unit at the time of publication.
What you'll learn
By the end of this learning pathway, you should be able to:
- collect information and identify financial risks
- assess level of financial risk
- establish risk-acceptance criteria
- prepare life insurance policy.
FNSILF410 - Underwrite financial risk in life insurance policies
Week 1: Life risk basics and risks to the insurer
- describe basic terms and conditions of insurance to clients
- explain basic actuarial principles and identify life risks
- identify the nature of life risks in relation to certain product types
- explain the relevant regulation and compliance requirements
- assess proposal documentation to clearly identify risk factors
- identify any need for additional information in order to further evaluate the proposal.
Week 2: Handling non-standard risks and Medical underwriting
- establish the terms of risk acceptance to suit the type and context of risk within relevant company policy and accepted levels of exposure
- evaluate occupational, pastime and residence risks against assessment criteria
- assess risk acceptability against all available information in accordance with appropriate underwriting guidelines
- establish terms and conditions that minimise risk liability
- describe non-standard terms and conditions of insurance to clients
- identify medical risks
- explain relevant medical terminology
- determine risk acceptance criteria.
Week 3: Assessing specific medical risks
- assess a proposal, clearly identifying medical risk factors
- assess acceptability of medical risks against all available information in accordance with appropriate underwriting guidelines
- establish risk acceptance criteria to suit the type and context of medical risk within relevant company policy
- determine terms and conditions within relevant authorities
- document terms and conditions to meet the requirements of relevant underwriting guidelines.
Week 4: Financial underwriting and reinsurance
- identify financial risks
- explain relevant financial terminology
- determine risk acceptance criteria
- determine and advise terms and conditions of financial risk acceptability
- identify the need for, and level of, reinsurance
- determine terms of reinsurance from available sources and in accordance with company policy
- negotiate reinsurance which provides required protection for anticipated exposure.
1 Exam and 1 Simulation