The syllabus for G80, the long term care, life and health protection option for advisers sitting their AFPC
The aim of the G80 is for candidates to develop an understanding of investment portfolio management so they can:
Identify an individual client's needs, in respect of both their personal and business circumstances, for financial protection in the event of requiring care in old age, cessation of income, ill-health or death;
Identify and apply different financial solutions to meet a client's identified needs including, where appropriate, the use of trusts;
Know of and be able to explain the medical and financial underwriting requirements in respect of the long-term care solutions and other protection product solutions recommended;
Know when and understand why an individual client's situation should be monitored and reviewed in respect of long term care and other protection needs.
Assumed knowledge and application skills
It is assumed that the candidate already has the knowledge and application skills gained from study of the relevant units of papers 1, 2 and 3 of the FPC or an equivalent regulatory benchmark and G10, Taxation and Trusts.
Method of assessment
Candidates will be expected to demonstrate their professional skills in advising individual clients on their need for financial protection, in the event of requiring care in old age, cessation of income, illness or death in both personal and business circumstances. This will mean candidates demonstrating, in a practical way, their ability to apply knowledge of long term care products and other protection products to provide suitable and appropriate advice in specific client situations.
1. Client needs
1.1 Collecting client data and information on client circumstances
l Demonstrate an understanding of the different ways of collecting relevant information about client circumstances direct from the client and from third parties, appropriate to long term care, life and health protection.
l Which factors to take into account when gathering client information such as mental and legal capacity, and client confidentiality.
1.2 Analysing client data: quantitative and qualitative
Interpret and evaluate relevant client circumstances and analyse the need for financial protection in the event of requiring care, cessation of income, ill-health and death.
2. Provision of care, State benefits and local authority funding
Candidates should have a detailed knowledge of the following State benefits, local authority and NHS provision and funding, particularly in respect of long term care, and should be able to explain how they interrelate with a client's financial circumstances.
2.1 State benefits
The process and assessment criteria used in applications for Incapacity Benefit, Disability Living Allowance, Disability Working Allowance, Attendance Allowance, Income Support, Industrial Injuries Disablement Benefit, Statutory Sick Pay, Job Seeker's Allowance, Invalid Care Allowance, Severe Disablement Allowance, Statutory Redundancy Benefits, Housing Benefit and Independent Living Fund, Working Families Tax Credit.
2.2 Local authority funding and provision for care
The process and assessment criteria used when applying for local authority benefits for long term care. Knowledge of the responsibilities of local authorities under the National Health Service and Community Care Act 1990 and the National Assistance Act 1948.
2.3 National Health Service provision
The NHS provision available; eligibility criteria for those requiring long-term care.
The different types of care, relative costs and availability.
2.4 Other provision for care benefits
Other sources of benefits such as charities, employers and professional bodies.
3. Long term care
Candidates should have a detailed knowledge of the following protection products, including their regulatory status, features, benefits, restrictions policy conditions and tax treatment. Candidates should be able to apply this knowledge to evaluate an individual client's long term care needs and other financial protection needs:
3.1 Immediate need plans
3.2 Pre-funded long term care insurance
3.3 Investment linked long term care insurance products
4. Other protection products
Candidates should have a detailed knowledge of the following protection products, including their regulatory status, features, benefits, restrictions, policy conditions and tax treatment. Candidates should be able to apply this knowledge to evaluate an individual client's financial protection needs
3.2 Ill health insurance
Income protection, (permanent health insurance), accident and sickness insurance, critical illness insurance, waiver of premium benefits, permanent and total disability benefits and terminal illness cover.
3.3 Life assurance
Term assurance, whole of life, accidental death, terminal illness options, family income benefit, death in service benefits.
3.4 Medical expenses
Private medical insurance including comprehensive plans, budget plans, dental care insurance, major medical expenses and hospital cash plans.
3.5 Redundancy insurance
Mortgage protection insurance, accident, sickness and unemployment insurance (ASU), standalone unemployment insurance.
5. Solutions and recommendations
5.1 Presenting solutions to meet an individual's personal, family and financial needs
Explain why the recommended action should be taken and offer reasoned recommendations to satisfy an individual client's personal and family protection needs.
Explain how their recommendations interact with existing arrangements, State, local authority and NHS funding and care provision.
5.2 Taxation implications of solutions
Explain the tax consequences of each solution they recommend in terms that the client will understand.
6.1 Suitable trusts for solutions
Which types of statutory and non-statutory trusts are suitable for a given set of circumstances.
The effect of their recommendations on any existing trusts.
Explain when and how policies should be written in trust.
6.2 Enduring powers of attorney, the role of the Court of Protection and powers of attorney
The scope of a client's enduring power of attorney and the role of the Court of Protection.
Powers of attorney.
Living wills.
6.3 Wills
The importance of wills in financial planning.
6.4 Rules affecting asset protection and asset deprivation
How legislation on long-term care, asset protection and consequences of deprivation impact on the client's entitlement to local authority funding, State benefits and other financial arrangements.
7. Monitoring a client's circumstances
7.1 Review of a client's circumstances
When and how to monitor changes in an individual client's circumstances and be able to react with new advice as both personal and legislative changes occur.
7.2 Review of protection products
When and how a key product review should be carried out in respect of premiums and benefits due to legislative change or at the instigation of the product provider.
For an investment related protection or long term care product, what action should be taken by a client and adviser in respect of fund growth and investment choice.
How any changes would impact on a client's circumstances and be able to recommend a revised solution.
8. Underwriting and its implications
8.1 Underwriting requirements
The main underwriting requirements for long-term care, life and health protection products covered in section 3 and 4 including medical evidence, lifestyle factors financial details and that such evidence might be acquired in the form of reports by GPs, paramedics and other medical professions.
8.2 Implications of underwriting
The reasons for and implications of underwriting decisions when making recommendations.
The individual's rights under the Data Protection Act 1998 and access to Medical Reports Act 1988.
8.3 Non-disclosure
The implications of non-disclosure of material facts when applying for cover.
9. Product claims
9.1 Claims criteria and process
The process of making a claim including the evidence required and the effect of the deferred period.
The role of the independent care needs assessment, where applicable.
The meaning of inability to perform activities of daily living (ADLs).
9.2 Claim options
The benefit choices available to clients when making a claim.
9.3 Viatical settlements
The role of viatical settlements in meeting an individual client's needs before a claim is made on a life assurance product.
10. Regulation, consumer protection and codes of practice
The compensation and redress available to a client in respect of individual long-term care, life and health protection advice.
The implications of the ABI Codes of Practice for General Insurance Business and life assurance (non-investment business) for intermediaries.
Source: The Chartered Insurance Institute
For further information log on to www.cii.co.uk
