Unit Standard 117146: Assignment Outcome 1

3.1.1.1 Explain the following terms in your own words:
i) Underwriting

ii) Premiums

iii) Penalties

iv) Withdrawal

3.1.2.1 Explain what your understanding of a pure risk investment and a new generation investment product is. Make use of examples.

3.1.3.1 Why would you choose a new generation investment product and avoid an old-generation product?

3.1.4.1 List at least 5 factors that influence the underwriting decision.

3.1.5.1 Explain the difference between a policy holder and a cessionary

3.1.6.1 Explain the difference between a collateral cession and an absolute cession. Make use of examples to distinguish between the two terms.

List and explain at least 5 risks that can have an influence on the insurance premium of the life policy.

What is the effect of inflation on the premium of a life insurance policy?

What role does reinsurance play in life insurance?

Who is the LOA and what do they do? 

What social responsibility programme or initiative exists in your current workplace, with reference to the sourcing of funding?  Explain.

What is insurable interest in terms of life cover?

3.1.13.1 Below is a table that names some of the parties to an insurance contract. Please list one obligation for each party in terms of a contract and one consequence of not meeting that obligation.

Explain how automatic increases apply to benefits and contributions under a life insurance contract. Give one advantage and one disadvantage of having automatic increases.

3.1.15.1 List four key costs incurred by an insurance company when issuing a new policy. How does paying a lump sum yearly premium upfront impact on the premium?

3.1.16.1 Draw a pie diagram to show the main components of a life insurance premium for a product that provides life cover as well as a savings element. The size of the sections must reflect the relative size of the premium component.

3.1.17.1 Describe the level of risk and the probable investor profile associated with each of these investment types.