Chapter 4 - Introduction To Financial Products And Customer Needs Flashcards

1
Q

Benefits

A
Unpredictable event
Unpredictable in time
Immediate consumption
Predictable in time
Accumulation of disposable income and capital
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2
Q

Types of provision

A
Social security
Financial products
Contracts
Schemes
Transactions
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3
Q

Social security benefits

A

Offered by state.

Means tested

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4
Q

Insurance contracts

A

Pay individual or heirs

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5
Q

Reinsurance contract

A

Pass some of the risk on

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6
Q

Benefit schemes

A

Short term

Annually renewable

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7
Q

Pension schemes

A

Accumaulation of funds pay out later

Retirement, death, withdrawal

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8
Q

Investment schemes

A

Higher amount paid back at later date

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9
Q

Derivatives

A

Value dpend of value of other investments or variables

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10
Q

Insurance principles

A

Insurable interest
Pre funding
Pooling of risk

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11
Q

Customer needs

A

Differentiate:
Logical and emotional
Current and future

Logical needs:
Maintaining current lifestyle
Protection
Accumulation for a purpose
Accumulation for unknown purpose
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