25654 version 1
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Demonstrate understanding of the business risk insurance market and
business risk insurance
Level
5
Credits
5
Purpose
People credited with this unit standard are able to demonstrate
understanding of:
– the business risk insurance market;
– types of business risk insurance relevant to clients of financial advisers;
and
– implementation and claims processes for business risk insurance.
Subfield
Financial Services
Domain
Financial Advice
Status
Registered
Status date
20 February 2009
Date version published
20 February 2009
Planned review date
31 December 2011
Entry information
Prerequisite: Unit 25645, Demonstrate understanding of
the life insurance market and life insurance, or
demonstrate equivalent knowledge and skills.
Accreditation
Evaluation of documentation and visit by NZQA, industry
and teaching professional in the same field from another
provider.
Standard setting body (SSB)
ElectroTechnology Industry Training Organisation
Accreditation and Moderation Action Plan (AMAP) reference
0003
This AMAP can be accessed at http://www.nzqa.govt.nz/framework/search/index.do.
Special notes
1
This unit standard may be assessed on job in the workplace using naturally occurring
evidence or in off job simulated work situations designed to draw upon similar
performance to that required in work in a financial services context, or a combination
of these.
 New Zealand Qualifications Authority 2016
25654 version 1
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2
References
Administration Act 1969;
AS/NZS 4360:2004 Risk Management;
Commerce Act 1986;
Companies Act 1993;
Consumer Guarantees Act 1993;
Credit Contracts and Consumer Finance Act 2003;
Electronic Transactions Act 2002;
Fair Trading Act 1986;
Family Protection Act 1955;
Financial Advisers Act 2008;
Financial Reporting Act 1993;
Financial Service Providers (Registration and Dispute Resolution) Act 2008;
Financial Transactions Reporting Act 1996;
Health and Safety in Employment Act 1992;
Human Rights Act 1993;
Income Tax Act 2007;
KiwiSaver Act 2006;
Law Reform (Testamentary Promises) Act 1949;
New Zealand Bill of Rights Act 1990;
NZ IFRS (New Zealand Equivalents to International Financial Reporting Standards)
available from http://www.nzica.com;
Privacy Act 1993;
Property (Relationships) Act 1976;
Reserve Bank of New Zealand Act 1989;
Securities Act 1978;
Securities Markets Act 1988;
Superannuation Schemes Act 1989;
Trustee Act 1956;
industry codes of practice;
and all subsequent amendments and replacements.
3
All activities must comply with any policies, procedures, and requirements of the
organisations involved; the standards of relevant professional bodies including codes
of ethics; and any relevant legislative and/or regulatory requirements.
4
Definitions
Financial situation – incorporates variables such as a client’s balance of assets,
liabilities, incomes, risks, needs and expectations.
Personal situation – incorporates variables such as a client’s personal relationships
and obligations, lifecycle stage, overall objectives, level of financial literacy.
 New Zealand Qualifications Authority 2016
25654 version 1
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Elements and performance criteria
Element 1
Demonstrate understanding of the business risk insurance market.
Performance criteria
1.1
The financial significance of business risk insurance is explained in relation to
insurable risk.
Range
1.2
insurable risk includes but is not limited to – protection in event of
death, disability or illness or key persons within business, loss of
income or profitability, loss or transfer of assets, loss of resources.
The purpose of business risk insurance transactions are explained in relation to
the roles and expectations of related parties.
Range
parties may include but are not limited to – insured, insurer,
beneficiary, business owners, officers of the company, staff,
trustees, insurance advisers, other professional advisers.
Element 2
Demonstrate understanding of types of business risk insurance relevant to the clients of
financial advisers.
Performance criteria
2.1
Types of business insurance products and strategies, together with appropriate
life insurance products are explained in terms of events covered, features and
benefits, and terms and conditions.
2.2
Different types of business risk insurance products and strategies are evaluated
in terms of suitability to clients’ personal situations, financial situations, business
situations and business financial situations.
Range
2.3
Client tax considerations of business risk insurance premiums and payouts are
explained in the context of current tax regimes.
Range
2.4
business situations include but are not limited to – business
structure (ie sole trader, partnership, private or public company,
trading trust), standard financial and accounting practices,
regulation and legislation;
business financial situation includes but is not limited to – business
relationships and obligations, overall business objectives.
tax considerations include but are not limited to – income tax,
Fringe Benefit Tax, Goods and Services Tax (GST).
Client considerations of policy ownership are explained in the context of current
client estate plans, personal situation, financial situation and tax implications.
 New Zealand Qualifications Authority 2016
25654 version 1
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Element 3
Demonstrate understanding of implementation and claims processes for business risk
insurance.
Performance criteria
3.1
The business risk insurance application process is explained in accordance with
commonly accepted practices of product providers.
3.2
Relevant elements of the underwriting, implementation and claims process are
identified and explained in terms of client responsibilities and insurer
requirements.
Range
relevant elements include but are not limited to – business
structure, business financial information, work duties and hours,
personal and family history, other health related factors, pastime
factors, access to medical reports, specific duty of disclosure
issues, recording ownership, commencement dates, loadings,
exclusions, pre-approval of claims, payment of claims, declination
of claims, monitoring of claims.
Please note
Providers must be accredited by NZQA, or an inter-institutional body with delegated
authority for quality assurance, before they can report credits from assessment against
unit standards or deliver courses of study leading to that assessment.
Industry Training Organisations must be accredited by NZQA before they can register
credits from assessment against unit standards.
Accredited providers and Industry Training Organisations assessing against unit standards
must engage with the moderation system that applies to those standards.
Accreditation requirements and an outline of the moderation system that applies to this
standard are outlined in the Accreditation and Moderation Action Plan (AMAP). The
AMAP also includes useful information about special requirements for organisations
wishing to develop education and training programmes, such as minimum qualifications for
tutors and assessors, and special resource requirements.
Comments on this unit standard
Please contact the ElectroTechnology Industry Training Organisation at
reviewcomments@etito.co.nz if you wish to suggest changes to the content of this unit
standard.
 New Zealand Qualifications Authority 2016