Change with the times or get left behind

The increase in lawsuits and arbitrations against financial advisors over the past few years clearly indicates that clients want more information about that which they are buying/being sold. Clients are seeking reliable information about life insurance products and researching the agents/brokers in the life insurance industry. Experience alone is no longer sufficient to provide familiarity with all the products in today’s life insurance market.

Technology has caused a massive shift in how clients and potential clients get information. Web-based services, such as THEInsuranceAdvisor.COM are supplying – cheaply and easily – the basic policy information that agents/brokers are not providing. In many cases the client needs both the independent research offered by THEInsuranceAdvisor.COM and life insurance advisory services offered by trusted life insurance practitioners.

Agents/brokers who are or may be perceived by clients as life insurance experts who are serving the best interests of the client would, therefore, be well served to provide independent research that supports such recommendations.  Similarly, independent advisors who owe a fiduciary duty to the client would also be well served to suggest/insist that product recommendations/proposals include independent research as to the suitability of the recommended product to the client’s situation relative to peer group product alternatives. 

Stephen Winks, author of the report entitled “Reshaping the Financial Services Industry: Operating Under Dodd-Frank,” concludes that brokers… who quickly and clearly understand the implications of the Security and Exchange Commission (SEC) rulemaking “will have a real opportunity for…profitability.”[1]

The report says the SEC’s report suggesting a uniform fiduciary standard, published in January and mandated by the Dodd-Frank law, established for the first time “that brokers are required to acknowledge their fiduciary status and affirm that they are acting in the best interests of the retail consumer.”

However, a fiduciary standard does NOT require that a recommended product be the “best” product.  Instead, it prescribes a “prudent process” which, if followed, can protect fiduciaries against future claims that some product was not the “best” for a given client in a given situation.  In other words, fiduciaries who follow a “prudent process” can actually be wrong about product selection and not be liable for recommending a product that may not have been the “best” in hindsight. 

For instance, in a recently adjudicated case of breach of fiduciary involving life insurance[2] , beneficiaries lost between $3.25 MILLION to $5.46 MILLION yet the court concluded the fiduciary was NOT liable for such losses.  How is it possible for beneficiaries to lose MILLIONS while the fiduciary was found to have been serving the client’s best interests?  Because the fiduciary was able to prove they followed a “prudent process” and did so using information from an "outside, independent entity with no policy to sell or any other financial stake in the outcome." 

Don’t get left behind! THEInsuranceAdvisor.COM is simply the fastest, easiest, and most credible, comprehensive and cost-effective way to independently verify to clients and their advisors whether or not the pricing and performance of existing or proposed life insurance is in their best interest.  Only THEInsuranceAdvisor.COM is accepted for independent client representation, endorsed by the New York Bankers Association (NYBA) and compliant with regulators. 

Use the Confidential Policy Evaluator (CPE) Research Reports to determine the appropriateness of pricing, the reasonableness of performance expectations for invested assets underlying policy cash values, and overall suitability for you(r client’s) policies based on the 5 factors of suitability.  Click here and get up to 3 Confidential Policy Evaluator (CPE) research reports under our NO-Risk trial subscription.