Unit of competency Outline

Information current as of
24/10/2026 1:39 AM AWST

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Settle policy payments and terminations

Settle policy payments and terminations

Unit of competency
National Code
FNSILF402A
State Code
D4175
TGA Status
Replaced
DTWD Status
Replaced
Current Release Number
1.00
Current Release Date
24/11/2010
View on TGA
State Implementation and Classification
Approved Date
15/05/2012
Original Release Date
24/11/2010
Nominal Hours
50
Field of Education
081103 - Insurance And Actuarial Studies
Description
This unit describes the performance outcomes, skills and knowledge required to settle payments and terminations on life insurance policies.This unit is applicable to individuals working within enterprises and job roles subject to licensing, legislative, regulatory or certification requirements including legislation administered by the Australian Securities and Investments Commission (ASIC).
General notes
N/A
Elements and Performance Criteria
1. Determine validation criteria
  • 1.1. Product type is identified so that payment criteria can be determined and the payment or termination processed accordingly
  • 1.2. Payment criteria are established to ensure compliance with the terms and conditions of the contract
2. Compile necessary documentation
  • 2.1. Requests are classified according to established payment criteria and required evidence is obtained from appropriate parties to confirm that the request complies with the terms and conditions of the policy
  • 2.2. Required forms and documents are completed and distributed in accordance with legislation, organisation policies and procedures
3. Advise customer/client of the consequences of processing the settlement
  • 3.1. Consequences relevant to policy type are identified
  • 3.2. Information is communicated clearly and concisely to ensure customer/client understands the consequences
  • 3.3. Result of communication is recorded and filed according to organisation procedures to ensure record is complete
4. Assign validity of request
  • 4.1. Request is validated within limits of delegated authority
  • 4.2. Decision to proceed with payment/termination of the contract is communicated to relevant parties
5. Review evidence available in support of payment request
  • 5.1. Payment criteria is established to enable compliance to be determined within the terms and conditions of the policy, legislation and regulations
  • 5.2. Available information on the payment request is reviewed against criteria to ensure compliance
  • 5.3. Request is assessed to determine whether terms and conditions of the policy have been met
  • 5.4. Additional opinion on the validity of the request is sought from relevant parties
6. Establish liability for payment under the policy
  • 6.1. Liability is identified in accordance with the terms and conditions of the policy
  • 6.2. Evidence is reviewed against the policy to determine the benefits payable
  • 6.3. Benefits payable are accurately calculated and cross-checked according to organisation procedures
  • 6.4. Register is updated to record payment liability and if appropriate, reinsurance recovery is made
7. Authorise payment where required and communicate decision
  • 7.1. Decision on liability is promptly advised to all relevant parties
  • 7.2. Level of payment authority is identified from organisation standards and procedures
  • 7.3. Payment details are checked for compliance with legislative and organisation requirements within delegated authority
  • 7.4. Authorisation is confirmed and discharge obtained as appropriate
RANGE STATEMENT
The range statement relates to the unit of competency as a whole. It allows for different work environments and situations that may affect performance. Bold italicised wording, if used in the performance criteria, is detailed below. Essential operating conditions that may be present with training and assessment (depending on the work situation, needs of the candidate, accessibility of the item, and local industry and regional contexts) may also be included.
Product types may include:
allocated pensions
disability income
endowment
immediate/deferred annuities
personal superannuation
singular or regular premium investments
term life
trauma
whole of life.
Payment criteria may include:
cancellation
death
expiry
invalidity
lapse
maturity
past surrender
pension
roll over
surrender
Temporary and Permanent Disability (TPD)
trauma
withdrawal
withdrawal annuities.
Terms and conditions of the contract may be determined by:
legislation and/or policy provisions.
Appropriate parties may include:
accountants
administrators
assignees
Australian Securities and Investments Commission (ASIC)
Australian Taxation Office (ATO)
chief medical officers
claims tribunals
courts
doctors
employers
executors
forensic scientists
investigation agencies
life insured
liquidators
next of kin
other life companies
personnel officers
police
policy owners
reinsurers
solicitors
trustees
underwriters.
Documentation may include:
ASIC reports
cheques
final statement
group certificates
medical reports
payment statements
tax forms.
Consequences of processing the settlement may include:
additional costs/charges if transferring to an alternative contract/policy
cessation of life cover in the event of a TPD claim
possible difficulty in obtaining optimal cover at a later date in the event of a deterioration in health
recommencement of the suicide clause.
Validation criteria means:
criteria against which a claim/withdrawal may be measured for validity.
Termination may include:
automatic cancellation because of non-payment of premium.
Benefits payable could be affected by:
age at death
cause of death
contributions made to policy
date of death
length of policy
non-disclosure
policy maturity
preserved nature of the funds in the policy
previous withdrawals
reason for withdrawal
surrender conditions.
Payment methods may include:
cheques
direct credit.
EVIDENCE GUIDE
The Evidence Guide provides advice on assessment and must be read in conjunction with the performance criteria, required skills and knowledge, range statement and the Assessment Guidelines for the Training Package.

Overview of assessment

Critical aspects for assessment and evidence required to demonstrate competency in this unit
Evidence of the ability to:
maintain awareness of situations requiring more extensive underwriting or assessment
apply clear understanding of superannuation beneficiary entitlements and conditions to be met and complied with.

Context of and specific resources for assessment
Assessment must ensure:
competency is demonstrated in the context of the work environment and conditions specified in the range statement either in a relevant workplace or a closely simulated work environment
access to and the use of a range of common office equipment, technology, software and consumables
access to organisation records
access to organisational policies and procedures.

Method of assessment
A range of assessment methods should be used to assess practical skills and knowledge. The following examples, in combination, are appropriate for this unit:
evaluating an integrated activity, which combines the elements of competency for the unit, or a cluster of related units of competency
observing processes and procedures in workplaces
verbal or written questioning on underpinning knowledge and skills
evaluating samples of work
accessing and validating third party reports
setting and reviewing workplace projects and business simulations or scenarios.

Guidance information for assessment
Replaced By
State Code National Code Title Type
AUR88 FNSILF402 Settle policy payments and terminations Unit of competency
No information