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SOUTH AFRICAN QUALIFICATIONS AUTHORITY 
REGISTERED UNIT STANDARD THAT HAS PASSED THE END DATE: 

Demonstrate knowledge of insurable risk 
SAQA US ID UNIT STANDARD TITLE
120124  Demonstrate knowledge of insurable risk 
ORIGINATOR
SGB Insurance and Investment 
PRIMARY OR DELEGATED QUALITY ASSURANCE FUNCTIONARY
-  
FIELD SUBFIELD
Field 03 - Business, Commerce and Management Studies Finance, Economics and Accounting 
ABET BAND UNIT STANDARD TYPE PRE-2009 NQF LEVEL NQF LEVEL CREDITS
Undefined  Regular  Level 4  NQF Level 04  3 
REGISTRATION STATUS REGISTRATION START DATE REGISTRATION END DATE SAQA DECISION NUMBER
Passed the End Date -
Status was "Reregistered" 		 2018-07-01  2023-06-30  SAQA 06120/18 
LAST DATE FOR ENROLMENT LAST DATE FOR ACHIEVEMENT
2024-06-30   2027-06-30  

In all of the tables in this document, both the pre-2009 NQF Level and the NQF Level is shown. In the text (purpose statements, qualification rules, etc), any references to NQF Levels are to the pre-2009 levels unless specifically stated otherwise.  

This unit standard replaces: 
US ID Unit Standard Title Pre-2009 NQF Level NQF Level Credits Replacement Status
14994  Demonstrate knowledge and understanding of insurable risk  Level 4  NQF Level 04  2   

PURPOSE OF THE UNIT STANDARD 
This Unit Standard is intended for all learners in insurance including learners who manage asset risk in insurance and other organisations. It will be useful for risk management generalists, as well as intermediaries, insurance surveyors, wealth managers, underwriters, and learners in Short Term and Long Term insurance, including agricultural insurance, who work in administration, call centers, claims support functions or who are involved in quotations.

The qualifying learner is capable of:
  • Explaining the concept of insurable risk.
  • Distinguishing between insurable and non-insurable risks.
  • Explaining the principle of average in relation to cover in short term insurance.
  • Applying categories and classes of insurance to categories of risk. 
    		•

    LEARNING ASSUMED TO BE IN PLACE AND RECOGNITION OF PRIOR LEARNING 
    It is assumed that learners are competent in Communication and Mathematical Literacy at Level 3. 

    UNIT STANDARD RANGE 
    The typical scope of this Unit Standard is:
  • Fundamental risks that do not qualify for insurance include, but are not limited to, natural disasters, wear and tear, maintenance, risks covered under SASRIA, business risk, risk of trading, risk of stock market , gambling and rust at the coast.
  • Non-insurable risks include, but are not limited to, business, stock market, shares, equities, gambling, illegal activities, economic and incidental risk.
  • Self insurance includes unfunded, captives and excess.
  • Risks that are unlikely to be insured include, but are not limited to, liquidity, credit, investment, resource risk, sales variability, fluctuation in consumer needs, changes in competitors' business strategies, guarantees and business activities.
  • Average includes, but is not limited to marine average, general average, particular average and general average to underwriters. 
    		•

    Specific Outcomes and Assessment Criteria: 

    SPECIFIC OUTCOME 1 
    Explain the concept of insurable risk. 

    ASSESSMENT CRITERIA     

    ASSESSMENT CRITERION 1 
    The concept of pooling of risk is explained with reference to reinsurance, short term insurance and long term insurance. 

    ASSESSMENT CRITERION 2 
    The concept of insurable interest is explained and an indication is given of how this impacts on the law of contract. 

    ASSESSMENT CRITERION 3 
    The concept of particular risk is explained in terms of the effect on the individual. 

    ASSESSMENT CRITERION 4 
    The concept of pure risk is explained in terms of loss. 

    ASSESSMENT CRITERION 5 
    The difference between a hazard and a peril is explained with examples. 

    ASSESSMENT CRITERION 6 
    Ways in which moral and physical hazards impact on insurance policies are explained with examples. 

    SPECIFIC OUTCOME 2 
    Distinguish between insurable and non-insurable risks. 

    ASSESSMENT CRITERIA     

    ASSESSMENT CRITERION 1 
    The concept of insurable risk is applied to financial loss. 

    ASSESSMENT CRITERION 2 
    Different situations are analysed to determine whether there is insurable risk, types of risks that are unlikely to be insured are named and suggestions are made for other ways to reduce such risks. 

    ASSESSMENT CRITERION 3 
    Undesirable risks are named and an indication is given of the conditions under which each could be insurable and when each would be regarded as non-insurable. 

    ASSESSMENT CRITERION 4 
    Fundamental risks that are non-insurable under standard insurance policies are identified and an explanation is offered as to why such risks do not qualify for insurance. 

    SPECIFIC OUTCOME 3 
    Explain the principle of average in relation to cover in short term insurance. 

    ASSESSMENT CRITERIA     

    ASSESSMENT CRITERION 1 
    The application of average in insurance is explained with examples. 

    ASSESSMENT CRITERION 2 
    The difference between indemnity and compensation is explained with examples. 

    SPECIFIC OUTCOME 4 
    Apply classes of insurance to categories of risk. 

    ASSESSMENT CRITERIA     

    ASSESSMENT CRITERION 1 
    The risks in a specific situation are analysed and classified in terms of insurable and non-insurable risk. 

    ASSESSMENT CRITERION 2 
    The insurable risks are categorised in terms of the most appropriate type or class of insurance for each risk. 

    ASSESSMENT CRITERION 3 
    A recommendation is made as to which risks should be insured and whether the entity should self insure or carry the risk. 

    ASSESSMENT CRITERION 4 
    The consequences of self insuring and carrying the risk are explained with examples. 


    UNIT STANDARD ACCREDITATION AND MODERATION OPTIONS 
  • Anyone assessing a candidate against this Unit Standard must be registered as an assessor with the relevant ETQA or ETQA where a Memorandum of Understanding (MOU) exists with the relevant ETQA.
  • Any institution offering learning that will enable achievement of this Unit Standard must be accredited as a provider through the relevant ETQA or ETQA where a Memorandum of Understanding (MOU) exists with the relevant ETQA.
  • Moderation of assessment will be overseen by the relevant ETQA according to the moderation guidelines and the agreed ETQA procedures. 
    		•

    UNIT STANDARD ESSENTIAL EMBEDDED KNOWLEDGE 
    N/A 

    UNIT STANDARD DEVELOPMENTAL OUTCOME 
    N/A 

    UNIT STANDARD LINKAGES 
    N/A 


    Critical Cross-field Outcomes (CCFO): 

    UNIT STANDARD CCFO IDENTIFYING 
    Learners are capable of identifying and solving problems in which responses show that responsible decisions using critical and creative thinking have been made in identifying the risks in a specific situation and recommending insurance, self insurance or carrying the risk. 

    UNIT STANDARD CCFO COLLECTING 
    Learners are capable of collecting, organising and critically evaluating information in analysing the risk in a specific situation. 

    UNIT STANDARD CCFO COMMUNICATING 
    Learners are capable of communicating effectively in explaining concepts, using case studies and recommending a course of action in a specific situation. 

    UNIT STANDARD CCFO DEMONSTRATING 
    Learners are capable of seeing the world as a set of related systems in understanding the impact of moral and physical hazards on a policy, explaining why some risks are regarded as fundamental and explaining the consequences of self insurance and carrying the risk. 

    UNIT STANDARD ASSESSOR CRITERIA 
    N/A 

    REREGISTRATION HISTORY 
    As per the SAQA Board decision/s at that time, this unit standard was Reregistered in 2012; 2015. 

    UNIT STANDARD NOTES 
    This unit standard replaces unit standard 14994, "Demonstrate knowledge and understanding of insurable risk", Level 4, 2 credits. 

    QUALIFICATIONS UTILISING THIS UNIT STANDARD: 
      ID QUALIFICATION TITLE PRE-2009 NQF LEVEL NQF LEVEL STATUS END DATE PRIMARY OR DELEGATED QA FUNCTIONARY
    Core  66610   Further Education and Training Certificate: Short Term Insurance  Level 4  NQF Level 04  Passed the End Date -
    Status was "Reregistered"     		 2023-07-30  As per Learning Programmes recorded against this Qual 
    Elective  57613   Further Education and Training Certificate: Short-Term Risk Management  Level 4  NQF Level 04  Passed the End Date -
    Status was "Reregistered"     		 2012-06-30  INSETA 
    Elective  65529   Further Education and Training Certificate: Transport Operations  Level 4  NQF Level 04  Passed the End Date -
    Status was "Reregistered"     		 2023-06-30  TETA 
    Elective  66613   Further Education and Training Certificate: Wealth Management  Level 4  NQF Level 04  Passed the End Date -
    Status was "Reregistered"     		 2023-06-30  As per Learning Programmes recorded against this Qual 


    PROVIDERS CURRENTLY ACCREDITED TO OFFER THIS UNIT STANDARD: 
    This information shows the current accreditations (i.e. those not past their accreditation end dates), and is the most complete record available to SAQA as of today. Some Primary or Delegated Quality Assurance Functionaries have a lag in their recording systems for provider accreditation, in turn leading to a lag in notifying SAQA of all the providers that they have accredited to offer qualifications and unit standards, as well as any extensions to accreditation end dates. The relevant Primary or Delegated Quality Assurance Functionary should be notified if a record appears to be missing from here.
     
    1. African Resources & Financial Training (Pty) Ltd 
    2. BRC Solutions (Pty) Ltd 
    3. CKP Development Agency (Pty) Ltd 
    4. De Vries Management & Training Services cc 
    5. Edu Wize Group Pty Ltd 
    6. Faisit (Pty) Ltd 
    7. Learning Exchange Pty (Ltd) 
    8. Quantum Leap College Pty Ltd 
    9. Ray Strodl Consulting (Pty) Ltd 
    10. Ripple Effect 4 (Pty) Ltd 
    11. The Graduate Institute of Financial Sciences (Pty) Ltd 


    All qualifications and part qualifications registered on the National Qualifications Framework are public property. Thus the only payment that can be made for them is for service and reproduction. It is illegal to sell this material for profit. If the material is reproduced or quoted, the South African Qualifications Authority (SAQA) should be acknowledged as the source.