RG 146.138 Given the nature of the insurance sector, the following specialist knowledge category for financial advisers on insurance products has been divided into core insurance knowledge and type of insurance product. This has been done to recognise industry feedback that there is a body of core insurance specific knowledge (separate to generic knowledge) that should also be understood by those operating within this sector.
Core insurance knowledge, all categories (i.e. general, life and broking)
RG 146.139 An financial adviser providing advice on insurance products will be required to apply the following knowledge (where applicable).
Insurance (Core Knowledge)
Insurance Markets Operation
- definition of insurance product
- characteristics and participants of the Australian insurance market
- roles played by intermediaries
Insurance Products
- types of insurance products (e.g. risk insurance products, investment life insurance products and general insurance products)
- conditions, exclusions, levels of coverage of risk transfer products
- pricing
Taxation
- insurance products taxation issues
Advisory functions
- the role of insurance adviser/broker/agent
- participants in the insurance advisory services market
- range of services provided
- profile and financial information of the client
- appropriateness of a risk assessment
Legal environment—disclosure and compliance
- the role of the representative/financial adviser
- relevant legal principles (e.g. Corporations Act, ASIC Act, Insurance Contracts Act 1984, Life Insurance Act 1995, Privacy Amendment (Private Sector) Act)
- the relationship between ethics and regulatory requirements (e.g. good faith, faith, utmost good faith, full disclosure of remuneration/fees and any other conflicts of interest which may influence the financial adviser’s recommendation)
- relevant industry standards and codes of conduct
- regulators’ guidelines including our requirements in this policy complaints resolution procedures (external and, if relevant, internal)