Course Title: Determine risk rating for investment and insurance products

Part B: Course Detail

Teaching Period: Term1 2012

Course Code: BAFI5143C

Course Title: Determine risk rating for investment and insurance products

School: 650T TAFE Business

Campus: City Campus

Program: C5205 - Diploma of Financial Services

Course Contact : Michael Elliot

Course Contact Phone: 61 3 9925 5519

Course Contact Email:michael.elliot@rmit.edu.au


Name and Contact Details of All Other Relevant Staff

Nominal Hours: 50

Regardless of the mode of delivery, represent a guide to the relative teaching time and student effort required to successfully achieve a particular competency/module. This may include not only scheduled classes or workplace visits but also the amount of effort required to undertake, evaluate and complete all assessment requirements, including any non-classroom activities.

Pre-requisites and Co-requisites

NONE

Course Description

This unit covers the functions involved in monitoring and analysing risks and determining the risk rating associated with an existing or new investment or insurance product.
It covers in-depth knowledge of the Life Insurance industry, including industry regulations and codes of practice, insurance and other financial products, financial markets and investment characteristics.


National Codes, Titles, Elements and Performance Criteria

National Element Code & Title:

FNSINSV505B Determine risk rating for investment and insurance products

Element:

1. Monitor and collect information on risk factors

Performance Criteria:

1.1. Product type is identified so that the nature of the risk can be identified and handled accordingly.
1.2. Relevant information is identified, monitored and collected.

Element:

2. Analyse data collected

Performance Criteria:

2.1. The reliability and validity of the data is established
2.2. Risk factors associated with a product are assessed against known exposure factors
2.3. All information collected on risk factors for a product is analysed using appropriate methods and documented
2.4. Need for additional information in order to further evaluate the risk is identified, collected and analysed

Element:

3. Determine risk rating for product

Performance Criteria:

3.1. Acceptability of risk is determined using all available information in accordance with company policy and procedures and underwriting guidelines
3.2. Risk rating that minimises risk liability is established within delegated authority
3.3. The basis for the risk rating decision is documented
3.4. Compliance with relevant legislation and company policy is considered
3.5. Risk rating information is documented in a format that may be used to guide underwriting and product/policy amendment decisions

Element:

4. Communicate results to appropriate personnel

Performance Criteria:

4.1. Results of research and analysis are presented to appropriate personnel in a clear, concise format
4.2. Risk rating recommendations are reviewed against existing products and organisational policies
4.3. Risk rating recommendations are finalised and relevant personnel notified


Learning Outcomes



Details of Learning Activities

To achieve the learning outcomes of the course students are required to participate in the learning activities listed below:

• Attendance at and note taking during teacher directed learning (scheduled classes);
• Reading of and note taking from the prescribed textbook and other references;
• Completion of tutorial exercises prior to each workshop. Tutorial exercises consist of practical problems, short answer questions, multiple choice, case studies and exercises;
• Attendance, participation and discussion in class (tutorials);
• Optional consultation with academic staff;
• Completion of three (3) assessment tasks as indicated below.


Teaching Schedule

 Week  Week CommencingTopics                Assessment 
   1  6th Feb

 Pre-training review: • RPL /LLN
Familiarisation with: • Program • Services/facilities • Other students • Teacher(s) • Where to get support • Student responsibilities • Course requirements • Course support documents • Pre-reading • Blackboard
• Overview of assessment requirements • Grading • Plagiarism • Appeals• Extensions • Feedback • Privacy • Submission requirements • Resubmission policy

Chapter 1
The Nature of Risk and its Management.
The concept of risk, Risk defined, How risk is measured and evaluated, The law of large numbers as the basis of insurance, Difference between risks, perils and hazards Classifications of risk

 
   2 13th FebChapter 2
Introduction to Risk Management.
Definition of risk management, Risk management process, Risk management tools, Rules of risk management, Personal risk management.
 
   3 20th FebChapter 3
Insurance and Risk.
Characteristics of insurance, Ideal requirements of an insurable risk, Principles of risk classification, Types of insurance
 Assessment on Topics from weeks 1 and 2
Multiple choice and Short Answer Questions Grading (CA/NYC)
   4 27th Feb Chapter 4
Regulation and Compliance.
Historical development of regulation of insurance industries in Australia, Regulation of insurance agents and brokers in Australia Impact of the Trades Practices Act 1974 (Cth), Roles played by APRA and ASIC
Impact of FSRA on licensing, disclosure and conduct obligations
 
   5 5th March Chapter 5
Policy, Law and Documentation
Key concepts, Making the insurance contract, Construction of the insurance policy, Claims Measurement of the loss
 
   6

 12th March

(Monday labour day)

Chapter 6
Introduction to Life Insurance
What is life insurance?
Insurance company operations
 
   7 19th marchIntroduction to Life Insurance
Key legislation
Industry structure
Assignment Handed out including discussion on assessment requirements.
   8 26th MarchIntroduction to General Insurance
Legislation and regulation in Australia
Dynamics of the Australian general insurance industry
Prudential standards and solvency requirements in Australia
 
   9 2nd AprilTaxation and Insurance
Taxation implications for life & general insurance companies, Taxation of life insurance premiums & proceeds, Taxation of life insurance death benefits, Taxation of disability insurance premiums and proceeds
Taxation of insurance products used for business purposes
Classes are 2nd, 3rd and 4th and the 12th and 13th
                                                                                Mid semester break (5 April to 11 April)
   9   9th AprilNo Tuesday Class 10th / Mid semester break 
 10 16th AprilChapter 9
Personal Risk Management
Steps in personal risk management
Property and liability risk management
Key essential of buying insurance
Electronic Draft of assignment to be submitted to teacher in class.
 11 23rd AprilChapter 10
Life Insurance Products
Traditional life policies, Term life insurance
Trauma insurance, Income protection policies, Business overheads
25 April (Wed)
Anzac Day
Final Assignment discussion
With teacher
 12 30th AprilChapter 11
General Insurance Products
Domestic insurance policies, Common types of liability policies, Small business insurance policies, General Insurance Code of Practice
Final Assignment discussion
With teacher
 13  7th May

Chapter 11

General Insurance Products

Continued as per above
Assignment due (CA/NYC)
 14 14th MayChapter 12
Mandated Insurance and Health Insurance
Chapter 12
Mandated Insurance and Health Insurance
Social security in Australia
Compulsory third party insurance, Workers compensation, Medicare and other benefit schemes
Private health insurance systems
 15 21st may Assessment 3 – (CA/NYC)
(From Topics covered in Weeks 3 to Weeks 14)
 
 16 28th May Re-submissions if required 
 17   4th June Feedback 


Learning Resources

Prescribed Texts

Teal, J; Insurance and Risk Management, John Wiley and Sons Australia Ltd


References


Other Resources

All students will need access to a copy of the prescribed text.

Lecture and tutorial notes are on blackboard and various readings if applicable.


Overview of Assessment

Assessment will incorporate a variety of methods including a collaborative research projects, presentations, closed book tests and/or examination.
Tests will comprise multiple-choice, case studies and short answer questions. It will assess underpinning knowledge and skills and the performance criteria of the unit.

Students are advised that they are likely to be asked to personally demonstrate their assessment work to their teacher to ensure that the relevant competency standards are being met. Students will be provided with feedback throughout the course to check their progress.


Assessment Tasks

Overview of Assessment
Students must demonstrate an understanding of all elements of competency to be deemed competent.

A range of assessment methods are used to assess practical skills and knowledge, for example:
• direct questioning combined with review of portfolios of evidence and third party workplace reports of on-the-job performance by the candidate
• review of authenticated documents from the workplace or training environment
• demonstration of techniques

Critical aspects of assessment

Evidence of the following is essential
• Interpret and apply organisation policy and procedures and compliance with legislation and regulations and industry codes of practice in monitoring, analysing and determining risk ratings.
• Apply knowledge and skills in the area of risk identification and assessment.
Assessment Tasks

You are required to complete 3 tasks. You must successfully complete all 3 tasks to be deemed competent in this unit.

TASK 1 (Due Date: 7th May, Week 3)
This will consist of a multiple choice question and short answer assessment. CA/NYC

TASK 2 (Due Date: 30th April, Week 13) CA/NYC
An individual assignment requiring students to conduct research into risk management.
The above task will be presented in report format (approx. 300- 500 words per recommendation).

TASK 3 (Due Date: 21st May, Week 15) CA/NYC
A two hour closed book assessment covering Topics covered in Weeks 3 to Weeks 14

Submission Requirements
You should:

• Ensure that you submit assessments on or before the due date. If your performance in the assessment is affected by unexpected circumstances, you should consider applying for Special Consideration. Information on the process and application forms is available at http://rmit.edu.au/browse;ID=ls0ydfokry9rz website.
• Always retain a copy of your assessment tasks. (hard copy and soft copy)
• When you submit work for assessment at RMIT University you need to use a cover sheet that includes a declaration and statement of authorship. You must complete, sign and submit a cover sheet with all work you submit for assessment, whether individual or group work. On the cover sheet you declare that the work you are presenting for assessment is your own work. An assignment cover sheet for submission of work for assessment is available on blackboard.
• Each page of your assessment should include footer with your name, student number, the title of the assessment, unit code and title and page numbers. For example, Julie Macpherson, 324567, Task 2, OHS2345C Ensure safe workplace, Page 1 of 10.





Marking Guide (competency):

Vocational Education and Training (VET) is based on current industry needs and the focus on preparing you for the workplace. Because VET courses are informed by practical application of knowledge and skills, they are based on a system known as ‘competency based training’ (CBT). So when you are assessed in VET it is about whether you are competent to do the job, as well as having a firm grasp on the knowledge and skills required to do that job, as opposed to traditional curriculum based education settings that are often based on knowledge retention.
You need to demonstrate you are competent in each element of the unit of competency you are studying.

You will receive feedback on each assessment task that will inform you whether you are competent or not and how well you are performing. Once competent in all elements of the unit you receive a competency grading.

Please refer to the Final Grades table below.

Marking Guide (Grading)

After achieving competency we then grade your performance in the unit; this gives you the opportunity to have the level of your performance formally recognized against industry standards and employability skills.

The grading is according to the following criteria:

1. LEVEL OF INDEPENDENCE, INITIATIVE, ENTERPRISE AND PERFORMANCE OF WORK TASK
We are looking for a high level of ability to complete all tasks independently as per the specifications as well as demonstrating a high level of initiative in your approach to job roles such as a actuaries, intermediaries, managers or supervisors, marketing and sales personnel, underwriters and other relevant organisational personnel. Have the ability to confirm to work requirements, using questioning and active listening as required, liaise with others, share information, listen and understand and use language and concepts appropriate to cultural differences.

2. DEMONSTRATED BREADTH OF UNDERPINNING KNOWLEDGE AND A WILLINGNESS TO CONTINUE LEARNING
We are looking for depth of understanding of the key concepts and knowledge required in accessing and managing financial services information, accessing financial product and services information and interpreting documentation. We are also looking at literacy skills to read, write, edit and proofread documents to ensure clarity of meaning, accuracy and consistency of information. Students should have knowledge of the basis of actuarial analysis and decisions, risk assessment policies and procedural guidelines, underwriting policies and procedures, geographic and demographic data, insurance products, premiums, extent of insurance coverage and other conditions of the insurance contract, investment product information, data and trends. Students should also have an understanding about insurance for accidental damage, burglary/theft, business interruption, defined events, employee fraud, environment and pollution, fire and perils, general and products liability, personal accident and illness, professional indemnity, public liability, directors and officers. Students should understand about, reinsurance, the relationship between underwriting and rate making, relevant legislation, regulatory guidelines and industry sector compliance requirements, such as the Insurance Contracts Act, Privacy Act, Trade Practices and Corporations Act. Knowledge of the risk analysis/prevention methods and application and type of risk and probability of likely occurrence.

3. TECHNIQUES & PROCESSES, TECHNOLOGY SKILLS AND PROBLEM SOLVING
We are looking for appropriate use of technology to assist in presenting all tasks clearly and suitable for the intended audience. You also need to show an understanding of the kinds of problems that can arise in managing client services or reporting and to develop options to resolve these issues when they arise. We also want you to interpret and apply organisation policy and procedures. Apply knowledge and skills in the area of risk identification and assessment. How compliance with legislation and regulations and industry codes of practice in monitoring, analysing and determining risk ratings is determined.

Assessment Tasks

You are required to complete 3 tasks. You must successfully complete all 3 tasks to be deemed competent in this unit.

TASK 1 (Due Date: 7th May, Week 3)
This will consist of a multiple choice question and short answer assessment. CA/NYC

TASK 2 (Due Date: 30th April, Week 13) CA/NYC
An individual assignment requiring students to conduct research into risk management.
The above task will be presented in report format (approx. 300- 500 words per recommendation).

TASK 3 (Due Date: 21st May, Week 15) CA/NYC
A two hour closed book assessment covering Topics covered in Weeks 3 to Weeks 14

Submission Requirements
You should:

• Ensure that you submit assessments on or before the due date. If your performance in the assessment is affected by unexpected circumstances, you should consider applying for Special Consideration. Information on the process and application forms is available at http://rmit.edu.au/browse;ID=ls0ydfokry9rz website.
• Always retain a copy of your assessment tasks. (hard copy and soft copy)
• When you submit work for assessment at RMIT University you need to use a cover sheet that includes a declaration and statement of authorship. You must complete, sign and submit a cover sheet with all work you submit for assessment, whether individual or group work. On the cover sheet you declare that the work you are presenting for assessment is your own work. An assignment cover sheet for submission of work for assessment is available on blackboard.
• Each page of your assessment should include footer with your name, student number, the title of the assessment, unit code and title and page numbers. For example, Julie Macpherson, 324567, Task 2, OHS2345C Ensure safe workplace, Page 1 of 10.





Marking Guide (competency):

Vocational Education and Training (VET) is based on current industry needs and the focus on preparing you for the workplace. Because VET courses are informed by practical application of knowledge and skills, they are based on a system known as ‘competency based training’ (CBT). So when you are assessed in VET it is about whether you are competent to do the job, as well as having a firm grasp on the knowledge and skills required to do that job, as opposed to traditional curriculum based education settings that are often based on knowledge retention.
You need to demonstrate you are competent in each element of the unit of competency you are studying.

You will receive feedback on each assessment task that will inform you whether you are competent or not and how well you are performing. Once competent in all elements of the unit you receive a competency grading.

Please refer to the Final Grades table below.

Marking Guide (Grading)

After achieving competency we then grade your performance in the unit; this gives you the opportunity to have the level of your performance formally recognized against industry standards and employability skills.

The grading is according to the following criteria:

1. LEVEL OF INDEPENDENCE, INITIATIVE, ENTERPRISE AND PERFORMANCE OF WORK TASK
We are looking for a high level of ability to complete all tasks independently as per the specifications as well as demonstrating a high level of initiative in your approach to job roles such as a actuaries, intermediaries, managers or supervisors, marketing and sales personnel, underwriters and other relevant organisational personnel. Have the ability to confirm to work requirements, using questioning and active listening as required, liaise with others, share information, listen and understand and use language and concepts appropriate to cultural differences.

2. DEMONSTRATED BREADTH OF UNDERPINNING KNOWLEDGE AND A WILLINGNESS TO CONTINUE LEARNING
We are looking for depth of understanding of the key concepts and knowledge required in accessing and managing financial services information, accessing financial product and services information and interpreting documentation. We are also looking at literacy skills to read, write, edit and proofread documents to ensure clarity of meaning, accuracy and consistency of information. Students should have knowledge of the basis of actuarial analysis and decisions, risk assessment policies and procedural guidelines, underwriting policies and procedures, geographic and demographic data, insurance products, premiums, extent of insurance coverage and other conditions of the insurance contract, investment product information, data and trends. Students should also have an understanding about insurance for accidental damage, burglary/theft, business interruption, defined events, employee fraud, environment and pollution, fire and perils, general and products liability, personal accident and illness, professional indemnity, public liability, directors and officers. Students should understand about, reinsurance, the relationship between underwriting and rate making, relevant legislation, regulatory guidelines and industry sector compliance requirements, such as the Insurance Contracts Act, Privacy Act, Trade Practices and Corporations Act. Knowledge of the risk analysis/prevention methods and application and type of risk and probability of likely occurrence.

3. TECHNIQUES & PROCESSES, TECHNOLOGY SKILLS AND PROBLEM SOLVING
We are looking for appropriate use of technology to assist in presenting all tasks clearly and suitable for the intended audience. You also need to show an understanding of the kinds of problems that can arise in managing client services or reporting and to develop options to resolve these issues when they arise. We also want you to interpret and apply organisation policy and procedures. Apply knowledge and skills in the area of risk identification and assessment. How compliance with legislation and regulations and industry codes of practice in monitoring, analysing and determining risk ratings is determined.




4. WORK ORGANISATION, PLANNING AND SELF MANAGEMENT
We expect to see ongoing uploading of information that is relevant to the unit, full utilisation of Blackboard as per course requirements and timely submission of all required assessment tasks. Teamwork skills
problem solving skills to identify any issues that have the potential to impact on organisational skills, including the ability to plan and sequence work. Self-management skills for complying with ethical, legal and procedural requirements.

5. COMMUNICATION, PEOPLE NETWORKING, LANGUAGE AND INTERPERSONAL SKILLS AND TEAMWORK

We expect to see contributions to relevant discussions and scheduled classroom sessions. In addition your tasks should demonstrate a very good understanding of strategies for well-developed literacy skills for analysing information on client needs and preparing clear written advice, plans and reports. This includes research skills such as: accessing and managing information, interpreting documentation and coordinating tasks.

Final Grades table:


CHD Competent with High Distinction
CDI Competent with Distinction
CC Competent with Credit
CAG Competency Achieved – Graded
NYC Not Yet Competent
DNS Did Not Submit for assessment


Assessment Matrix

Course Overview: Access Course Overview