issurance advisory statement of advice

issurance advisory statement of advice

Case study information

You are an authorised representative with many years’ experience in the insurance and financial planning industry. You have recently attained your Master of Business (Financial Planning) degree, which is in addition to your previous qualification, an Advanced Diploma of Financial Services (FP). You run a very successful practice Peak Risk Solutions (PRS) in the heart of downtown Parramatta. Your executive assistant John has just informed you that prospective new clients Jacqui and Brook Flannery are ready and waiting to see you. Jacqui and Brook Flannery seem an interesting couple and are very specific in that they are only seeking guidance and possible advice from you in relation to their unique risk management situation. Jacqui and Brook Flannery make very clear their concern is about their future wellbeing and protection and their desire for assistance in developing a risk management plan for their family.

 

John has already sent Jacqui and Brook Flannery a Client Profile (commonly referred to as a Fact Finder or data collection instrument) to complete and your Dealer’s Financial Services Guide (FSG). This identifies you as an authorized representative (use your student ID as a reference for this) of licensed dealer: Peak Risk Solutions Pty Ltd (PRS), a leading provider of risk management services including personal and general insurance, financial planning and risk solutions. PRS has ABN: 13 000 200272 and Australian Financial Services Licence (AFSL): 215 272. Contact details for PRS include: Level 11, 272 Asic Street, Parramatta NSW 2151. Phone 9630 5000; toll free 1300 215272; www.prs.com.au; email insurance@prs.com.au. As an authorised representative of PRS you are licensed to provide both insurance and financial planning advice.

 

After analysing the completed Fact Finder and client file you determine the following information. Jacqui Flannery was born in 1980 she married Brook born in 1979 some 12 years ago. They have twins Martin and Carrick aged 10. Jacqui is a recent university graduate with a Bachelor or Forensic Science. She works part time in a local retail outlet earning $25000 per year. Brook is a psychologist running his own practice. He works long hours in CBD of Sydney. He currently draws a salary from the business  of 150000 per annum .

The business employs two staff Nicole the receptionist and Michelle the accounts payable clerk. The following annual expenses relate to the business.

$

Rent of Premises                         30,000

Wages                                       58,000

Brooks Salary                                       150,000

Electricity & other Utilities            6,000

Stationery and consumables                   10,000

Computer support                        5,000

 

Brook recently went to the doctor for a health check and was amazed to find that he had extremely low thyroid function and the doctor is concerned and ordered more tests. Jacqui fears Brook will need some time off work and the resulting tiredness due to the condition may require him to reduce his work hours.. The doctor advised him to review his lifestyle and reduce his stress at work. Brook laughed at this proposition. The business is in a huge growth phase and there is no one he can call on for support and sees a lot of hard work ahead of him at least in the short term. Hearing this Jacqui became concerned and urged her husband to reconsider his position. However this had little effect.

They have a house on acreage in a leafy suburb of Sydney. They have a mortgage of $ 500,000on their home which was recently valued at $950,000.They both own cars, she drives a Mazda sports car and he drives a Lexus. The cars are valued at $160,000 in total and they have an outstanding loan of $50000 and they have no comprehensive insurance as the costs of the premiums are prohibitive.

Additionally they have a credit card debt the balance of which averages $40000.

Jacqui and Brook believe in private education and estimate that they will need $60,000 for each child not including university expenses. The children will be totally dependent on their parents till age 25.

Brook’s parents died recently in a plane crash and since that time he has been totally responsible for the financial support of his severely drug addicted   brother, Malcolm who is unable to work. Malcolm is currently 28 years old and receives unemployment benefits of $18000 per annum from Centrelink. Most of this is spent on drugs. Brook feels morally obliged to support his brother financially and he has set aside $1000 per month to meet Malcolm’s needs. In relation to the rest of his family Brook estimates that they spend $2000 per month on their living expenses and an additional $200 per week on each member of the family

They are not keen on insurance and see it as a waste of money. Hence their house in uninsured and their contents valued $500000 including $250000 worth of art is also uninsured. At the present time the family have no private health insurance.

Additional Information:

• The current life expectancy of women is 85 years and men 80 years
• Funeral costs approx $10000
• Legal expenses $5000
• Medical costs $50000
• Emergency Funds $20000

 

Required:

Brook and Jacqui are particularly concerned about developing a risk management plan for the family.

Respond to this request for information by preparing the required Statement of Advice (SOA), and ASIC compliant documentation. Included in your preparation should be:

• the services that you can provide as an authorised representative (FSG)
• your understanding of their needs and objectives
• a risk assessment in relation to the family and a summary of Jacqui and Brook’s wealth protection (insurance) needs
• an outline of the types of products suitable for discussion, including analysis of specific products available in the Australian marketplace) and a calculation of the level of cover required for each product
• the criteria for why you have chosen to include a specific product in your recommendation, eg This could be by way of a table or chart comparing fictitious product features and benefits, options etc.
• There is no need to source specific products. Use generic products for recommendation purposes. For example:ABC Life covers

List any questions that you would have for Jacqui and Brook to gain further insight into their situation.

 

Marking Criteria and standards

Please refer to the assessment criteria on the following page.

 

/20

        Insurance and Risk Management      

Assignment 2 – Statement of Advice – Marking Guide

Your family name

Your given name

Your Student ID

 

CRITERIA	UNSATISFACTORY		NEEDS IMPROVEMENT	MEETS EXPECTATIONS		EXCEEDS EXPECTATIONS
Follows specified structure
Cover letter	Not provided; imitates examples too closely		Missing information	Original, meets basic requirements, < 1 page		Original, comprehensive, succinct,  < 1 page
Marks	0		0.5	1.0		1.5
Cover page	Not provided or missing >2 essential details		Missing 1 or 2 essential details	Fully compliant, 1 page		Fully compliant, shows initiative, 1 page
Marks	0		0.5	1.0		1.5
Summary of advice	Not provided or missing more than 2 points or unstructured		Brief summary; possibly missing 1 or 2 points	Basic neat summary covering advice; approx 1 page		Comprehensive, well-structured summary; approx 1 page
Marks	0		1.0	1.5		2.0        2.5
Table of contents	Omitted or missing > 2 sections or > 2 formatting errors		Missing 1 or 2 sections; or, 1 or 2 formatting errors	Basic format, covering all major sections		Professional, complete, demonstrates initiative
Marks	0		0.5	1.0		1.5
Gives appropriate advice
Section 1: Important information about you	Missing >2 items, no analysis , messy, < 2 pages		Missing 1 or 2 items, or little analysis, or minor formatting errors, 2-3 pages	Neat, complete, demonstrates basic analysis,  approx 4 pages		Professional , complete; demonstrates depth of analysis; approx 4 pages
Marks	0		1.5	2.0		2.5
Section 2: My advice to you	Little evidence of analysis, limited advice, more than 4 errors, < 3 pages		Basic analysis attempted, with 3 or 4 errors, incomplete advice, 3-4 pages	Well-reasoned competent analysis with no more than two mistakes, approx 5 pages		Professional, comprehensive, demonstrates depth of analysis; provides original contribution; approx 5  pages
Marks	1		1.0          1.5          2.0	2.0          2.5         3.0		3.5     5.0     7.0     10.0
Section 3: What else you need to know	3 or more pieces of missing  information, poorly structured or untidy, < 3 pages		1 or 2 pieces of information missing, not well organised, 3-4 pages	Adequate information,  well presented,, approx 5 pages		Professional, comprehensive, well structured; provides original contribution; approx 5  pages
Marks	0		1.5	2.0		2.5
Presents with clarity
References (Harvard style required)	None; missing >2 references; or > 3 mistakes		Missing 1 or 2 references and/no more than 3 mistakes	All sources referenced but 1 or 2 mistakes		Comprehensive, showing care in researching the issues; format correct and clear
Marks	0		0.5	1.0		1.5
Clear prose style: sentence structure, grammar, spelling, etc.	Writing style is poor and difficult to follow and/or marred by many grammatical and/or spelling errors		Writing style is unclear at times; a number of grammatical and/or spelling errors	Writing style is coherent with no more than a few grammatical and/or spelling errors		Writing style is clear and error free, demonstrating superior written communication skills
Marks	0		0.5	1.0		1.5
Marks deducted	Late submission (- 10% or -2 marks per day)
	Failure to follow instructions: Cover sheet missing or incomplete, unsigned cover sheet, marking guide missing or incomplete; failure to use prescribed framework, etc
Well done J		Needs work !			Suggestion for improvement M

Case study information

You are an authorised representative with many years’ experience in the insurance and financial planning industry. You have recently attained your Master of Business (Financial Planning) degree, which is in addition to your previous qualification, an Advanced Diploma of Financial Services (FP). You run a very successful practice Peak Risk Solutions (PRS) in the heart of downtown Parramatta. Your executive assistant John has just informed you that prospective new clients Jacqui and Brook Flannery are ready and waiting to see you. Jacqui and Brook Flannery seem an interesting couple and are very specific in that they are only seeking guidance and possible advice from you in relation to their unique risk management situation. Jacqui and Brook Flannery make very clear their concern is about their future wellbeing and protection and their desire for assistance in developing a risk management plan for their family.

 

John has already sent Jacqui and Brook Flannery a Client Profile (commonly referred to as a Fact Finder or data collection instrument) to complete and your Dealer’s Financial Services Guide (FSG). This identifies you as an authorized representative (use your student ID as a reference for this) of licensed dealer: Peak Risk Solutions Pty Ltd (PRS), a leading provider of risk management services including personal and general insurance, financial planning and risk solutions. PRS has ABN: 13 000 200272 and Australian Financial Services Licence (AFSL): 215 272. Contact details for PRS include: Level 11, 272 Asic Street, Parramatta NSW 2151. Phone 9630 5000; toll free 1300 215272; www.prs.com.au; email insurance@prs.com.au. As an authorised representative of PRS you are licensed to provide both insurance and financial planning advice.

 

After analysing the completed Fact Finder and client file you determine the following information. Jacqui Flannery was born in 1980 she married Brook born in 1979 some 12 years ago. They have twins Martin and Carrick aged 10. Jacqui is a recent university graduate with a Bachelor or Forensic Science. She works part time in a local retail outlet earning $25000 per year. Brook is a psychologist running his own practice. He works long hours in CBD of Sydney. He currently draws a salary from the business  of 150000 per annum .

The business employs two staff Nicole the receptionist and Michelle the accounts payable clerk. The following annual expenses relate to the business.

$

Rent of Premises                         30,000

Wages                                       58,000

Brooks Salary                                       150,000

Electricity & other Utilities            6,000

Stationery and consumables                   10,000

Computer support                        5,000

 

Brook recently went to the doctor for a health check and was amazed to find that he had extremely low thyroid function and the doctor is concerned and ordered more tests. Jacqui fears Brook will need some time off work and the resulting tiredness due to the condition may require him to reduce his work hours.. The doctor advised him to review his lifestyle and reduce his stress at work. Brook laughed at this proposition. The business is in a huge growth phase and there is no one he can call on for support and sees a lot of hard work ahead of him at least in the short term. Hearing this Jacqui became concerned and urged her husband to reconsider his position. However this had little effect.

They have a house on acreage in a leafy suburb of Sydney. They have a mortgage of $ 500,000on their home which was recently valued at $950,000.They both own cars, she drives a Mazda sports car and he drives a Lexus. The cars are valued at $160,000 in total and they have an outstanding loan of $50000 and they have no comprehensive insurance as the costs of the premiums are prohibitive.

Additionally they have a credit card debt the balance of which averages $40000.

Jacqui and Brook believe in private education and estimate that they will need $60,000 for each child not including university expenses. The children will be totally dependent on their parents till age 25.

Brook’s parents died recently in a plane crash and since that time he has been totally responsible for the financial support of his severely drug addicted   brother, Malcolm who is unable to work. Malcolm is currently 28 years old and receives unemployment benefits of $18000 per annum from Centrelink. Most of this is spent on drugs. Brook feels morally obliged to support his brother financially and he has set aside $1000 per month to meet Malcolm’s needs. In relation to the rest of his family Brook estimates that they spend $2000 per month on their living expenses and an additional $200 per week on each member of the family

They are not keen on insurance and see it as a waste of money. Hence their house in uninsured and their contents valued $500000 including $250000 worth of art is also uninsured. At the present time the family have no private health insurance.

Additional Information:

• The current life expectancy of women is 85 years and men 80 years
• Funeral costs approx $10000
• Legal expenses $5000
• Medical costs $50000
• Emergency Funds $20000

 

Required:

Brook and Jacqui are particularly concerned about developing a risk management plan for the family.

Respond to this request for information by preparing the required Statement of Advice (SOA), and ASIC compliant documentation. Included in your preparation should be:

• the services that you can provide as an authorised representative (FSG)
• your understanding of their needs and objectives
• a risk assessment in relation to the family and a summary of Jacqui and Brook’s wealth protection (insurance) needs
• an outline of the types of products suitable for discussion, including analysis of specific products available in the Australian marketplace) and a calculation of the level of cover required for each product
• the criteria for why you have chosen to include a specific product in your recommendation, eg This could be by way of a table or chart comparing fictitious product features and benefits, options etc.
• There is no need to source specific products. Use generic products for recommendation purposes. For example:ABC Life covers

List any questions that you would have for Jacqui and Brook to gain further insight into their situation.

 

Marking Criteria and standards

Please refer to the assessment criteria on the following page.

 

/20

        Insurance and Risk Management      

Assignment 2 – Statement of Advice – Marking Guide

Your family name

Your given name

Your Student ID

 

CRITERIA	UNSATISFACTORY		NEEDS IMPROVEMENT	MEETS EXPECTATIONS		EXCEEDS EXPECTATIONS
Follows specified structure
Cover letter	Not provided; imitates examples too closely		Missing information	Original, meets basic requirements, < 1 page		Original, comprehensive, succinct,  < 1 page
Marks	0		0.5	1.0		1.5
Cover page	Not provided or missing >2 essential details		Missing 1 or 2 essential details	Fully compliant, 1 page		Fully compliant, shows initiative, 1 page
Marks	0		0.5	1.0		1.5
Summary of advice	Not provided or missing more than 2 points or unstructured		Brief summary; possibly missing 1 or 2 points	Basic neat summary covering advice; approx 1 page		Comprehensive, well-structured summary; approx 1 page
Marks	0		1.0	1.5		2.0        2.5
Table of contents	Omitted or missing > 2 sections or > 2 formatting errors		Missing 1 or 2 sections; or, 1 or 2 formatting errors	Basic format, covering all major sections		Professional, complete, demonstrates initiative
Marks	0		0.5	1.0		1.5
Gives appropriate advice
Section 1: Important information about you	Missing >2 items, no analysis , messy, < 2 pages		Missing 1 or 2 items, or little analysis, or minor formatting errors, 2-3 pages	Neat, complete, demonstrates basic analysis,  approx 4 pages		Professional , complete; demonstrates depth of analysis; approx 4 pages
Marks	0		1.5	2.0		2.5
Section 2: My advice to you	Little evidence of analysis, limited advice, more than 4 errors, < 3 pages		Basic analysis attempted, with 3 or 4 errors, incomplete advice, 3-4 pages	Well-reasoned competent analysis with no more than two mistakes, approx 5 pages		Professional, comprehensive, demonstrates depth of analysis; provides original contribution; approx 5  pages
Marks	1		1.0          1.5          2.0	2.0          2.5         3.0		3.5     5.0     7.0     10.0
Section 3: What else you need to know	3 or more pieces of missing  information, poorly structured or untidy, < 3 pages		1 or 2 pieces of information missing, not well organised, 3-4 pages	Adequate information,  well presented,, approx 5 pages		Professional, comprehensive, well structured; provides original contribution; approx 5  pages
Marks	0		1.5	2.0		2.5
Presents with clarity
References (Harvard style required)	None; missing >2 references; or > 3 mistakes		Missing 1 or 2 references and/no more than 3 mistakes	All sources referenced but 1 or 2 mistakes		Comprehensive, showing care in researching the issues; format correct and clear
Marks	0		0.5	1.0		1.5
Clear prose style: sentence structure, grammar, spelling, etc.	Writing style is poor and difficult to follow and/or marred by many grammatical and/or spelling errors		Writing style is unclear at times; a number of grammatical and/or spelling errors	Writing style is coherent with no more than a few grammatical and/or spelling errors		Writing style is clear and error free, demonstrating superior written communication skills
Marks	0		0.5	1.0		1.5
Marks deducted	Late submission (- 10% or -2 marks per day)
	Failure to follow instructions: Cover sheet missing or incomplete, unsigned cover sheet, marking guide missing or incomplete; failure to use prescribed framework, etc
Well done J		Needs work !			Suggestion for improvement M

The assignment addresses and assesses key learning outcomes as follows:

1. Describe how the various risk concepts, classifications, rules and methods of handling risk are integrated into the overall risk management process.
2. Demonstrate a comprehensive understanding of the Australian regulatory environment in which risk management advice and insurance products are provided.
3. Understand the client fact finding process and how to prepare a needs analysis to provide resulting insurance recommendations.
4. Critically assess the risk management and insurance needs of individuals and small business.
5. Describe the different types of life, general and other insurance products and their application to real world consumers and small business.
6. Demonstrate effective professional communication and interpersonal skills both oral and written.
7. Demonstrate technological literacy which contributes to effective execution of tasks.

Further information and explanation of requirements will be covered in lectures and tutorials. Further assistance may also be available on vUWS.

 

1500 words requirement.

Is this the question you were looking for? If so, place your order here to get started!