Chapter 1- Market Factors And Trends In Financial Protection Planning Flashcards
When mitigating personal risk, how is it best to categorise risks?
By severity of impact and likelihood of event
What sort of severity/impact risk are best to insure against?
Low frequency, high impact
What are the main drivers of sales of insurance products?
Affordability
Movements in housing market
Income per head and other economic factors
Whether they have dependents
How do you calculate the protection gap?
Resources needed - Individual and employer cover in place + protection gap
How does inflation effect sales of life insurance?
Negative impact.
People feel poorer so do not regard life insurance as important when money is short.
What is the definition of morbidity?
Relative incidence of a particular disease
What is a preferred life policy?
Effectively reverses the underwriting process. Cherry picking positive lifestyle habits to reduce the premiums.
