ISR3702 Assignment 2 (DETAILED ANSWERS) Semester 1 2024 - DISTINCTION GUARANTEED

ISR3702 Assignment 2 (DETAILED ANSWERS) Semester 1 2024 - DISTINCTION GUARANTEED Answers, guidelines, workings and references ...................Question 1 (50 marks) Bantu Life Insurance Company received the following life insurance proposal from Chief Mlaudzi, who indicated that, because he lacked the necessary knowledge about life policies, the underwriter should select an appropriate policy for each person: 1.1 Indicate an appropriate life policy or policies for each person and substantiate your answer. (24) 1.2 Classify each person into an underwriting class and substantiate your answer. (24) 1.3 Name one factor that is missing from the proposal but that could be used to answer question 1.2 above. (2) No. Name Age Gender Occupation Income Proposed sum assured Relationship to Chief Mlaudzi 1 Florence 38 Female Community projects R0 R100 000 Spouse 2 Vimla 39 Female Community projects R0 R100 000 Spouse 3 Zimkane 28 Male University student R0 R50 000 Child 4 Xoliswa 6 Female Still in school R0 R50 000 Child 5 Kgadu 13 Male Still in school R0 R50 000 Child 6 Vhonani 15 Male Still in school R0 R60 000 Child ISR3702 Tutorial Letter 102 Page 2 of 2 Question 2 (20 marks) South Africa’s Minister of Finance informed the nation that the government is going to implement a two-pot retirement system from September 2024. 2.1 Explain the purpose of a two-pot retirement system. (4) 2.2 Describe two advantages of this system. (4) 2.3 Describe two disadvantages of this system. (4) 2.4 Describe the peril(s) covered by this retirement system. (2) 2.5 Briefly explain any three components of a two-pot retirement system. (6)