LO10 Needs, Priorities and Suitable Solutions
Consequences of inadequate protection, personal and business need calculations, existing cover, product comparison, affordability, inclusive advice, trusts and regular review.
How to prepare for R05
Match the annual edition to your sitting, quantify the event-driven shortfall, distinguish policy structures and tax, then test ownership, affordability and suitability.
Core concepts
Concept 1
Protection analysis quantifies future capital and income shortfalls for personal and business clients after testing existing arrangements, State or employer support and available resources.
Exam cue: Define event, affected people, amount, start date, duration and existing resources before selecting a product.
Concept 2
Suitable solutions may combine products and must reflect priorities, amount, term, affordability, exclusions, flexibility, ownership, trusts and Consumer Duty outcomes.
Exam cue: For a business, separate loan, keyperson and shareholder or partnership ownership needs.
Concept 3
Inclusive planning considers relationships, caring, property, separation, work, overseas plans, retirement, health, wellbeing, vulnerability and protected characteristics without unsupported assumptions.
Exam cue: Record affordability, foreseeable harm, support needs, trust suitability and review triggers.
Risk pitfalls and guardrails
Recommending a familiar product before quantifying and prioritising the shortfall.
Guardrail: Do not mix capital, income, treatment, care and debt benefits, or assume State, employer and policy resources have identical amount, timing and certainty.
Double-counting existing arrangements or assuming an employer benefit continues indefinitely.
Guardrail: Do not mix capital, income, treatment, care and debt benefits, or assume State, employer and policy resources have identical amount, timing and certainty.
Using protected characteristics or household status as a shortcut instead of obtaining relevant facts.
Guardrail: Do not mix capital, income, treatment, care and debt benefits, or assume State, employer and policy resources have identical amount, timing and certainty.
Memory anchors
EADDO
Event, affected people, deficit, duration and offsets define the need.
C-I-N
Capital need, income need and net resources drive the calculation.
BLKS
Business loans, keyperson loss and shareholder needs require separate analysis.
MATCH
Match amount, term, affordability, contract and holder or trust.
Duty Outcomes
Act in good faith, avoid foreseeable harm and support the client’s financial objectives.
Life Changes
Review after relationship, child, property, work, health, business or affordability changes.
Checkpoint rule
Do the check-up only after you can summarize each concept in one sentence and identify one dangerous pitfall from memory.
Knowledge Check (after reading)
Short check-up to confirm understanding of this module.
Check-up Questions
Before comparing protection products, what should an adviser establish first?
Why should priorities be agreed before recommending products?
Answer all questions to submit.
Next step personalized recommendations
Continue learning
Move forward only after this module is stable.
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