Application
This unit describes the skills and knowledge required to underwrite renewal business, including determining the terms and conditions of risk acceptance, evaluating the response of the client, negotiating and finalising the cover.
It applies to individuals in job roles of underwriting in a range of insurance sectors and may be applied within organisations of various sizes and across a range of client bases.
Work functions in the occupational areas where this unit may be used are subject to regulatory requirements. Refer to the FNS Implementation Guide Companion Volume or the relevant regulator for specific guidance on requirements.
Elements and Performance Criteria
ELEMENT | PERFORMANCE CRITERIA |
Elements describe the essential outcomes. | Performance criteria describe the performance needed to demonstrate achievement of the element. |
1. Determine terms and conditions of risk acceptability | 1.1 Identify and review risk acceptance information 1.2 Determine risk acceptability within authority limitations 1.3 Check terms and conditions of risk acceptability for changes since last time it was reviewed for underwriting 1.4 Determine terms and conditions of risk acceptance in accordance with risk acceptance criteria, including client history 1.5 Propose alternative terms or adjusted benefits, if applicable |
2. Communicate result of risk assessment | 2.1 Make offer of renewal, if applicable, in accordance with legislative requirements 2.2 Issue provisional notice of expiry to client 2.3 Decline renewal, if applicable, in accordance with legislative provisions |
3. Evaluate client response | 3.1 Assess client response to determine whether action to modify terms and conditions is required 3.2 Modify offer as necessary and prepare advice to client according to operating procedures 3.3 Ensure offer complies with underwriting acceptance authorities and criteria, or seek appropriate referral approval |
4. Negotiate agreement | 4.1 Undertake negotiation on revised offer to reach mutually satisfactory agreement 4.2 Advise client of acceptance or rejection of risk according to operating procedures (including information on dispute resolution procedure if necessary) |
5. Cancel, lapse or renew cover | 5.1 Issue revised documentation to client in organisational format and according to organisational operating procedures and legislative requirements 5.2 Confirm reinsurance cover as appropriate 5.3 Issue lapse notice to client, if applicable, in accordance with organisational procedures 5.4 File and store documentation according to operating procedures |
Evidence of Performance
Evidence of the ability to:
comply with all legal obligations and organisational procedures
identify and assess risks, and develop suitable proposals for underwriting renewal business
negotiate agreements
interpret and apply underwriting guidelines
complete and file relevant documentation in accordance with organisational guidelines.
Note: If a specific volume or frequency is not stated, then evidence must be provided at least once.
Evidence of Knowledge
To complete the unit requirements safely and effectively, the individual must:
describe the industry market position relative to product or line of insurance business
identify key features of relevant legislation, regulatory guidelines and industry sector compliance requirements
explain the importance of wording of insurance policies in keeping with the organisation or industry sector
outline possible terms and conditions relating to risk acceptability
outline organisational policy, procedures, underwriting guidelines and levels of authority
describe relevant organisational products that relate to insurance underwriting
describe the difference between treaty and facultative reinsurance
outline relative industry hazards
explain risk prevention methods and application.
Assessment Conditions
Assessment must be conducted in a safe environment where evidence gathered demonstrates consistent performance of typical activities experienced in the insurance services field of work and include access to:
organisational records
organisational policy, procedures, legislation and regulations as they relate to contracts of insurance
a range of common technology and software.
Assessors must satisfy NVR/AQTF assessor requirements.
Foundation Skills
This section describes language, literacy, numeracy and employment skills incorporated in the performance criteria that are required for competent performance.
Skill | Performance Criteria | Description |
Reading | 1.1, 1.3, 1.4, 3.1, 3.3 | Analyses and consolidates information and data from a range of sources, against defined criteria and requirements, and checks for accuracy and completeness |
Writing | 1.5, 2.1-2.3, 3.2, 4.2, 5.1, 5.3 | Accurately records information and prepares correspondence and documentation using clear language and organisational formats and protocols |
Oral Communication | 2.1, 2.3, 4.1, 4.2 | Effectively participates in verbal exchanges using active listening and questioning to convey and clarify information |
Numeracy | 1.5, 3.2 | Performs mathematical calculations to analyse financial data to accurately process documentation |
Navigate the world of work | 1.2, 2.3, 3.2, 3.3, 5.1, 5.3, 5.4 | Takes personal responsibility for following explicit and implicit policies, procedures and legislative requirements Identifies and acts on issues that contravene relevant policies, procedures and legal requirements |
Interact with others | 2.2, 3.1, 3.3, 4.1, 4.2 | Uses collaborative techniques to establish a sense of connection, build rapport and negotiate positive outcomes with clients Recognises and accommodates basic differences and priorities of others |
Get the work done | 1.1-1.5, 2.3, 3.3, 4.2, 5.2-5.4 | Takes responsibility for planning, sequencing and prioritising tasks and own workload for efficiency and effective outcomes Addresses less predictable problems and initiates standard procedures in response, applying problem-solving processes in determining solutions Uses digital technologies to access, enter and store information required to complete work tasks |
Sectors
Insurance services