Application
This unit describes the skills and knowledge required to analyse a client’s insurance needs and provide ethical and professional advice that complies with industry regulations and codes of practice. It addresses the training requirements of current Australian Securities and Investments Commission (ASIC) and Australian Financial Services (AFS) licensing at Tier 1 level.
The unit applies to those who use well-developed interpersonal, communication and self-management skills and general insurance knowledge to perform a specialist advisory role in insurance broking and address the needs of both retail and wholesale clients.
At the time of publication, no licensing requirements apply to this unit. However, given potential future changes in the licensing environment, users must check with the relevant licensing body to confirm whether this unit is required to complete a licence.
Elements and Performance Criteria
1. Prepare to provide advice in insurance broking | 1.1 Identify client enquiry and inform client about role of adviser and licensee or principal responsible for adviser’s conduct 1.2 Establish client’s objectives and goals and obtain personal, financial and business details to identify client’s needs 1.3 Respond to enquiries about insurance broking products and services by explaining range of products and services available and their relevant fee and charging methodology 1.4 Establish risk profile in relation to client’s business activities according to organisational procedures |
2. Analyse client’s objectives, needs, financial situation and risk profile to develop appropriate strategies and solutions | 2.1 Assess client needs taking into account client’s information, product expectations and specific needs 2.2 Consult client throughout analysis for further clarification where necessary 2.3 Analyse need for higher level or specialist advice and ensure client is referred to appropriate adviser if required 2.4 Assess and confirm risk profile of client, demonstrating ASIC-identified generic and specialist knowledge relevant to products and services being offered 2.5 Determine appropriate strategy to provide for identified needs and outcomes, based on analysis of products and services, client risk profile and assessment of client needs 2.6 Conduct relevant research, analysis and product modelling, and draft appropriate solution and plan, policy or transaction for presentation to client |
3. Present appropriate strategies and solutions to client and negotiate financial plan, policy or transaction | 3.1 Apply appropriate knowledge for product or service offered when presenting outcomes of analysis 3.2 Clearly and unambiguously explain proposed transaction to client 3.3 Reinforce required details, terms and conditions of product or service 3.4 Disclose impacts and possible risks of solution in clear and concise manner 3.5 Provide supporting written documentation and guide client through key aspects of documentation 3.6 Discuss and clarify concerns and issues that client has regarding proposed plan, policy or transaction 3.7 Confirm that client understands proposed plan, policy or transaction |
4. Agree to plan, policy or transaction and complete documentation | 4.1 Obtain client’s formal agreement to confirmed plan, policy or transaction 4.2 Explain and confirm client understanding of fees, cost structures and timeframes for execution and processing of agreed plan, policy or transaction 4.3 Obtain signed proposal and statutory and transactional documents required from client 4.4 Exchange copies of signed agreement and other required documentation according to organisational procedures |
5. Agree to and implement arrangements for providing ongoing service | 5.1 Agree to type and form of client-preferred ongoing service to be provided 5.2 Clearly explain fees and costs for ongoing and specifically defined services, and confirm client understanding 5.3 Implement arrangements for agreed ongoing service according to organisational policies and procedures |
Evidence of Performance
The candidate must demonstrate the ability to complete the tasks outlined in the elements, performance criteria and foundation skills of this unit, including evidence of the ability to:
provide advice in insurance broking to at least three different clients.
Evidence of Knowledge
The candidate must be able to demonstrate knowledge to complete the tasks outlined in the elements, performance criteria and foundation skills of this unit, including knowledge of:
legislative and organisational compliance requirements in relation to advice, including:
legislation affecting the provision of general and personal advice, including relevant regulatory guidelines on conduct and disclosure
roles and responsibilities of different advisers within the organisation
organisational policies and guidelines relating to provision of advice and communication
legal environment, including disclosure and compliance covering:
role of the representative or adviser and applicable fiduciary duty obligations
relationship between ethics and regulatory requirements, including good faith, faith, utmost good faith, full disclosure of remuneration and fees, and any other conflicts of interest which may influence the adviser’s recommendation
required industry standards and codes of practice
regulators’ guidelines, including Australian Securities and Investments Commission (ASIC) Regulatory Guides applicable to the insurance broking sector and advisory role of a broker and Australian Financial Services (AFS) licensing
internal and external complaints resolution procedures
legal principles relating to legislation and regulations that impact on the general insurance and general insurance broking sector, including the Corporations Act, ASIC Act, Insurance Contracts Act, privacy regulations, Competition and Consumer Act
broking practices in respect to assisting clients with insurance claims
methods for assessing insurable risk exposures
organisational procedures for delivering insurance broking services
impact of economic environment on general insurance sector
operation of insurance markets, including:
definition of insurance product and service
characteristics and participants of the Australian insurance market
roles played by intermediaries
key features of general insurance products and services, including retail and wholesale products and:
conditions, exclusions and levels of coverage of risk transfer products
pricing
aspects of ongoing service provision, including:
reporting on performance
review of plan, policy or transaction
available ways of communication
taxation issues in relation to insurance products and markets
advisory functions, including:
roles and responsibilities of insurance adviser, broker or agent
role of licensee or principal responsible for adviser’s conduct, including procedures for complaints handling and circumstances in which they should be applied
participants in the insurance advisory services market
relationship between industry sectors.
Assessment Conditions
Skills in this unit must be demonstrated in a workplace or simulated environment where the conditions are typical of those in a working environment in this industry.
This includes access to:
organisational equipment, technology, software and consumables
insurance broking product information.
Assessors of this unit must satisfy the requirements for assessors in applicable vocational education and training legislation, frameworks and/or standards.
Foundation Skills
Numeracy | Interprets financial information on products and services, and calculates client costs, risks and returns |
Oral communication | Clearly articulates requirements using language suitable to audience and environment Uses active listening and questioning techniques to confirm understanding |
Learning | Extends knowledge of insurance broking product and service features relevant to current role using research and investigative analysis to select investments that suit client needs |
Reading | Interprets information from required sources |
Writing | Uses clear, specific and industry-related terminology to complete and consolidate workplace documentation |
Initiative and enterprise | Takes personal responsibility for following policies, procedures and protocols to provide advisory services and documentation that comply with legal, statutory and organisational requirements |
Self-management | Takes responsibility for the planning, sequence and priority of tasks within own workload to achieve effective and compliant outcomes Applies systematic and analytical decision-making processes to determine and implement investment solutions that meet client needs and financial requirements |
Teamwork | Selects and uses appropriate conventions and protocols when communicating with clients to build rapport, seek and share information, establish clear agreement and maintain an ethical service relationship |
Technology | Uses the main features and functions of digital tools to complete work tasks |
Sectors
ASIC units