FPC004 Insurance Advice - Assessment Questions

Section A

Question 1 (5 marks | Word limit: 150 words)

Critically analyse personal and small business risks.

Consider the following pieces of information:

• There were around 25.5 million active life insurance policies in Australia in 2018, according to APRA. 
• There were approximately 12.5 million working-aged Australians (aged 15–64) in 2018, according to the Australian Institute of Health and Welfare.
• Rice Warner’s Underinsurance in Australia 2017 report estimated that 94% of working Australians had some level of life cover, with an average of approximately $143,500 (twice the median household income).
• Rice Warner’s Underinsurance in Australia 2017 report concluded that the amount required for a family to be adequately covered by life insurance, is around eight times the family income.

Given the information above, and your knowledge of life insurance, evaluate and discuss the following statement:

‘Australians are managing their personal risk effectively through insurance.’