Advisorheads Homepage
Forum Home Forum Home > Introductions > Greenhorn Introductions
  New Posts New Posts RSS Feed - Introduction
  FAQ FAQ  Forum Search   Events   Register Register  Login Login

Introduction

 Post Reply Post Reply
Author
Message
socalfa View Drop Down
Greenhorns
Greenhorns
Avatar

Joined: Jun/08/2017
Status: Offline
Points: 35
Post Options Post Options   Thanks (0) Thanks(0)   Quote socalfa Quote  Post ReplyReply Direct Link To This Post Topic: Introduction
    Posted: Jun/08/2017 at 1:28am
I'm an advisor 2 years into the business. Series 7, 66, work for a large insurance-based financial company.
Back to Top
RipRock View Drop Down
Senior Member
Senior Member
Avatar

Joined: Oct/29/2013
Status: Offline
Points: 1807
Post Options Post Options   Thanks (0) Thanks(0)   Quote RipRock Quote  Post ReplyReply Direct Link To This Post Posted: Jun/08/2017 at 8:55am
Originally posted by socalfa socalfa wrote:

I'm an advisor 2 years into the business. Series 7, 66, work for a large insurance-based financial company.


Does DOL let insurance agents say they are financial advisors or is that still not fixed?
Back to Top
socalfa View Drop Down
Greenhorns
Greenhorns
Avatar

Joined: Jun/08/2017
Status: Offline
Points: 35
Post Options Post Options   Thanks (0) Thanks(0)   Quote socalfa Quote  Post ReplyReply Direct Link To This Post Posted: Jun/08/2017 at 10:07am
I'm a fiduciary who also happens to hold L&H insurance licenses.
Back to Top
brome90 View Drop Down
Member
Member


Joined: Mar/12/2014
Status: Offline
Points: 420
Post Options Post Options   Thanks (0) Thanks(0)   Quote brome90 Quote  Post ReplyReply Direct Link To This Post Posted: Jun/08/2017 at 10:13am
I can't wait to read what is to come.
Back to Top
missionshooter View Drop Down
Senior Member
Senior Member
Avatar

Joined: Feb/12/2014
Status: Offline
Points: 6136
Post Options Post Options   Thanks (0) Thanks(0)   Quote missionshooter Quote  Post ReplyReply Direct Link To This Post Posted: Jun/08/2017 at 10:24am
Originally posted by socalfa socalfa wrote:

I'm a fiduciary who also happens to hold L&H insurance licenses.


Preach It Brother!
Back to Top
PEACH_cm View Drop Down
Senior Member
Senior Member


Joined: Jan/16/2013
Status: Offline
Points: 7184
Post Options Post Options   Thanks (0) Thanks(0)   Quote PEACH_cm Quote  Post ReplyReply Direct Link To This Post Posted: Jun/08/2017 at 10:34am
Originally posted by socalfa socalfa wrote:

I'm a fiduciary who also happens to hold L&H insurance licenses.
Not if you work for a large insurance based company. You might think you are but you are not. 
Back to Top
socalfa View Drop Down
Greenhorns
Greenhorns
Avatar

Joined: Jun/08/2017
Status: Offline
Points: 35
Post Options Post Options   Thanks (0) Thanks(0)   Quote socalfa Quote  Post ReplyReply Direct Link To This Post Posted: Jun/08/2017 at 11:09am
Won't argue the semantics, but when the head honcho from home office compliance comes and says "you're a fiduciary now and will be treated as one" I say "ok".

Not here to argue with the veterans, just want to read and learn. 
Back to Top
Guests View Drop Down
Guest Group
Guest Group
Post Options Post Options   Thanks (0) Thanks(0)   Quote Guests Quote  Post ReplyReply Direct Link To This Post Posted: Jun/08/2017 at 11:15am
Originally posted by socalfa socalfa wrote:

Won't argue the semantics, but when the head honcho from home office compliance comes and says "you're a fiduciary now and will be treated as one" I say "ok".

Not here to argue with the veterans, just want to read and learn. 


Well it's gonna happen either way. Just FYI
Back to Top
RipRock View Drop Down
Senior Member
Senior Member
Avatar

Joined: Oct/29/2013
Status: Offline
Points: 1807
Post Options Post Options   Thanks (0) Thanks(0)   Quote RipRock Quote  Post ReplyReply Direct Link To This Post Posted: Jun/08/2017 at 11:29am
Originally posted by socalfa socalfa wrote:

I'm a fiduciary who also happens to hold L&H insurance licenses.


Hmmm, maybe I am wrong and you are not required to sell ("help people") insurance. In your hiring agreement are you not obliged to have a minimum of activity in insurance sells?
Back to Top
Guests View Drop Down
Guest Group
Guest Group
Post Options Post Options   Thanks (0) Thanks(0)   Quote Guests Quote  Post ReplyReply Direct Link To This Post Posted: Jun/08/2017 at 11:31am
Originally posted by RipRock RipRock wrote:

Originally posted by socalfa socalfa wrote:

I'm an advisor 2 years into the business. Series 7, 66, work for a large insurance-based financial company.


Does DOL let insurance agents say they are financial advisors or is that still not fixed?

The DOL does not regulate insurance agents.  That's what state departments of insurance do.  The DOL regulates qualified plans.
Back to Top
Guests View Drop Down
Guest Group
Guest Group
Post Options Post Options   Thanks (0) Thanks(0)   Quote Guests Quote  Post ReplyReply Direct Link To This Post Posted: Jun/08/2017 at 11:32am
Originally posted by RipRock RipRock wrote:

Originally posted by socalfa socalfa wrote:

I'm a fiduciary who also happens to hold L&H insurance licenses.


Hmmm, maybe I am wrong and you are not required to sell ("help people") insurance. In your hiring agreement are you not obliged to have a minimum of activity in insurance sells?

Maybe I am wrong and you are not required to sell ("help people") in selling securities.  By FINRA requirements, if you don't do any securities sales, you are then "parking" your licenses?

Why Series 7 Brokers Legally CAN’T Be Client Fiduciaries Without DoL Fiduciary



Edited by D.H.K. - Jun/08/2017 at 11:35am
Back to Top
bagua View Drop Down
Member
Member


Joined: May/03/2011
Status: Offline
Points: 268
Post Options Post Options   Thanks (0) Thanks(0)   Quote bagua Quote  Post ReplyReply Direct Link To This Post Posted: Jun/08/2017 at 3:07pm
Socalfa this isn't a shot at you. It's an interesting question and I am interested in what you are hearing in your office. My understanding is that as an "Agent" of the insurance company you cannot be a fiduciary. Those two roles are mutually exclusive. You have a duty as an "Agent" to the company. You are empowered to bind coverage on the part of the company with the applicant. That power comes with the obligation to protect the interests of the company. You can't put anyone's interest before the agency. Not yours, not the clients, not your Momma.
  This has fuckall to do with your ability or interest in taking care of your clients. You may be right on the line of putting your client first, but the company, by virtue of the Producer contract you signed, has first dibs on your attention.
 
That's how I understand it. I was only a career agent for 4 or 5 years, so I could be wrong. Interested in your thoughts.
 
Bagua
Back to Top
Guests View Drop Down
Guest Group
Guest Group
Post Options Post Options   Thanks (0) Thanks(0)   Quote Guests Quote  Post ReplyReply Direct Link To This Post Posted: Jun/08/2017 at 3:27pm
https://www.kitces.com/blog/the-4-different-types-of-financial-advisor-fiduciaries/

"I explore four different types of financial advisor fiduciaries, including:
RIAs that are SEC fiduciaries, 
DoL fiduciaries serving retirement investors, 
CFP fiduciaries providing financial planning, and 
voluntary fiduciaries who decide to step up to honor private/third-party fiduciary standards."

However one holds themselves out to the public, is the standard they will be held accountable for their recommendations.

When you're selling insurance (life, DI, fixed annuity, LTC, etc.), as soon as you are taking an application, you are working in the interests of the insurance company to complete a proper application.  Until you are taking an application, you're working for your client to determine an appropriate action/level of protection, etc.

If you sell anything to do with qualified retirement plans including IRAs, then you are a fiduciary.

Can an insurance agent be a 100% fiduciary all the time?  No.  (Unless you have set up legal engagement agreements, have a life & disability analyst license in your state, and accept a fee for service.)

Can an RIA/IAR for the SEC be a 100% fiduciary all the time?  Yes.

Can an RIA/IAR for the SEC who has an outside business activity be a 100% fiduciary all the time?  I would surmise 'no' because it is an outside business activity with its own rules and regulations.  However, you would need to disclose that a conflict of interest exists and that you receive a commission.


Edited by D.H.K. - Jun/08/2017 at 3:37pm
Back to Top
socalfa View Drop Down
Greenhorns
Greenhorns
Avatar

Joined: Jun/08/2017
Status: Offline
Points: 35
Post Options Post Options   Thanks (0) Thanks(0)   Quote socalfa Quote  Post ReplyReply Direct Link To This Post Posted: Jun/08/2017 at 11:53pm
Originally posted by bagua bagua wrote:

Socalfa this isn't a shot at you. It's an interesting question and I am interested in what you are hearing in your office. My understanding is that as an "Agent" of the insurance company you cannot be a fiduciary. Those two roles are mutually exclusive. You have a duty as an "Agent" to the company. You are empowered to bind coverage on the part of the company with the applicant. That power comes with the obligation to protect the interests of the company. You can't put anyone's interest before the agency. Not yours, not the clients, not your Momma.
  This has fuckall to do with your ability or interest in taking care of your clients. You may be right on the line of putting your client first, but the company, by virtue of the Producer contract you signed, has first dibs on your attention.
 
That's how I understand it. I was only a career agent for 4 or 5 years, so I could be wrong. Interested in your thoughts.
 
Bagua

No offense taken....

In terms of the recommendations made, anything that remotely resembles an asset or investment gets passed through compliance to verify "best interest of the client" (only exception to this being term life, as far as I know). This includes products that would not be considered investments but are a savings vehicle (e.g. permanent indexed or whole life policies).

In theory, I could never sell a single insurance product and make my validation. Comp from A Shares or advisory accounts all goes towards my benefits-eligible compensation. In practice, doing insurance/annuity makes up a large part of my BOB because (a) protecting against the risk of dying too soon or living too long is an important part of many clients' financial plan, and (b) life insurance pays well.

As a mild jab at the "RIA fiduciary purists" -- if your only compensation comes from asset management fees, does that not give an incentive to ignore or downplay necessary life insurance coverage, because every dollar into a premium is a dollar not going into a wrap account? In terms of making a comprehensive financial plan, that seems like a potential conflict of interest.

Back to Top
PEACH_cm View Drop Down
Senior Member
Senior Member


Joined: Jan/16/2013
Status: Offline
Points: 7184
Post Options Post Options   Thanks (0) Thanks(0)   Quote PEACH_cm Quote  Post ReplyReply Direct Link To This Post Posted: Jun/09/2017 at 7:06am
Originally posted by socalfa socalfa wrote:

Originally posted by bagua bagua wrote:


Socalfa this isn't a shot at you. It's an interesting question and I am interested in what you are hearing in your office. My understanding is that as an "Agent" of the insurance company you cannot be a fiduciary. Those two roles are mutually exclusive. You have a duty as an "Agent" to the company. You are empowered to bind coverage on the part of the company with the applicant. That power comes with the obligation to protect the interests of the company. You can't put anyone's interest before the agency. Not yours, not the clients, not your Momma.
  This has fuckall to do with your ability or interest in taking care of your clients. You may be right on the line of putting your client first, but the company, by virtue of the Producer contract you signed, has first dibs on your attention.
 
That's how I understand it. I was only a career agent for 4 or 5 years, so I could be wrong. Interested in your thoughts.
 
Bagua


No offense taken....

In terms of the recommendations made, anything that remotely resembles an asset or investment gets passed through compliance to verify "best interest of the client" (only exception to this being term life, as far as I know). This includes products that would not be considered investments but are a savings vehicle (e.g. permanent indexed or whole life policies).

In theory, I could never sell a single insurance product and make my validation. Comp from A Shares or advisory accounts all goes towards my benefits-eligible compensation. In practice, doing insurance/annuity makes up a large part of my BOB because (a) protecting against the risk of dying too soon or living too long is an important part of many clients' financial plan, and (b) life insurance pays well.

As a mild jab at the "RIA fiduciary purists" -- if your only compensation comes from asset management fees, does that not give an incentive to ignore or downplay necessary life insurance coverage, because every dollar into a premium is a dollar not going into a wrap account? In terms of making a comprehensive financial plan, that seems like a potential conflict of interest.

Wow, a special kind of stupid..... I'm just going to drink my coffee and revisit this thread later.
Back to Top
RipRock View Drop Down
Senior Member
Senior Member
Avatar

Joined: Oct/29/2013
Status: Offline
Points: 1807
Post Options Post Options   Thanks (0) Thanks(0)   Quote RipRock Quote  Post ReplyReply Direct Link To This Post Posted: Jun/09/2017 at 8:22am
Originally posted by socalfa socalfa wrote:

Originally posted by bagua bagua wrote:


Socalfa this isn't a shot at you. It's an interesting question and I am interested in what you are hearing in your office. My understanding is that as an "Agent" of the insurance company you cannot be a fiduciary. Those two roles are mutually exclusive. You have a duty as an "Agent" to the company. You are empowered to bind coverage on the part of the company with the applicant. That power comes with the obligation to protect the interests of the company. You can't put anyone's interest before the agency. Not yours, not the clients, not your Momma.
  This has fuckall to do with your ability or interest in taking care of your clients. You may be right on the line of putting your client first, but the company, by virtue of the Producer contract you signed, has first dibs on your attention.
 
That's how I understand it. I was only a career agent for 4 or 5 years, so I could be wrong. Interested in your thoughts.
 
Bagua


No offense taken....

In terms of the recommendations made, anything that remotely resembles an asset or investment gets passed through compliance to verify "best interest of the client" (only exception to this being term life, as far as I know). This includes products that would not be considered investments but are a savings vehicle (e.g. permanent indexed or whole life policies).

In theory, I could never sell a single insurance product and make my validation. Comp from A Shares or advisory accounts all goes towards my benefits-eligible compensation. In practice, doing insurance/annuity makes up a large part of my BOB because (a) protecting against the risk of dying too soon or living too long is an important part of many clients' financial plan, and (b) life insurance pays well.

As a mild jab at the "RIA fiduciary purists" -- if your only compensation comes from asset management fees, does that not give an incentive to ignore or downplay necessary life insurance coverage, because every dollar into a premium is a dollar not going into a wrap account? In terms of making a comprehensive financial plan, that seems like a potential conflict of interest.





Exact response I was expecting from you.

1. You pass everything off to the "company" to decide YOUR clients best interest disguised as "compliance".
2. Insurance = Savings vehicle
3. Insurance is your lead in because everyone should have fear of something and you sell the answer.

Listen, it's unfortunate that I singled you out - you are not alone, but I really think the fiduciary rule should have made a very exact distinction of who is a financial advisor and who represents a company or product as a sales person.





Back to Top
Moraen View Drop Down
Admin Group
Admin Group
Avatar
Resident Sage

Joined: Mar/09/2010
Status: Offline
Points: 30786
Post Options Post Options   Thanks (0) Thanks(0)   Quote Moraen Quote  Post ReplyReply Direct Link To This Post Posted: Jun/09/2017 at 8:30am
Originally posted by socalfa socalfa wrote:

Originally posted by bagua bagua wrote:

Socalfa this isn't a shot at you. It's an interesting question and I am interested in what you are hearing in your office. My understanding is that as an "Agent" of the insurance company you cannot be a fiduciary. Those two roles are mutually exclusive. You have a duty as an "Agent" to the company. You are empowered to bind coverage on the part of the company with the applicant. That power comes with the obligation to protect the interests of the company. You can't put anyone's interest before the agency. Not yours, not the clients, not your Momma.
  This has fuckall to do with your ability or interest in taking care of your clients. You may be right on the line of putting your client first, but the company, by virtue of the Producer contract you signed, has first dibs on your attention.
 
That's how I understand it. I was only a career agent for 4 or 5 years, so I could be wrong. Interested in your thoughts.
 
Bagua

No offense taken....

In terms of the recommendations made, anything that remotely resembles an asset or investment gets passed through compliance to verify "best interest of the client" (only exception to this being term life, as far as I know). This includes products that would not be considered investments but are a savings vehicle (e.g. permanent indexed or whole life policies).

In theory, I could never sell a single insurance product and make my validation. Comp from A Shares or advisory accounts all goes towards my benefits-eligible compensation. In practice, doing insurance/annuity makes up a large part of my BOB because (a) protecting against the risk of dying too soon or living too long is an important part of many clients' financial plan, and (b) life insurance pays well.

As a mild jab at the "RIA fiduciary purists" -- if your only compensation comes from asset management fees, does that not give an incentive to ignore or downplay necessary life insurance coverage, because every dollar into a premium is a dollar not going into a wrap account? In terms of making a comprehensive financial plan, that seems like a potential conflict of interest.



There are parts of this that I could agree with.  First, the AUM fees as a method of compensation do align the incentive with doing as little as possible to generate those fees.  However, RIAs have to consider a few other incentives as well.  Being a small company competing against big company's, they have to differentiate themselves.  Second, RIAs have flexibility and can indeed be paid on life insurance.  They can charge for a life insurance "consultation" on an hourly or fixed fee basis. 

Third, there is a high likelihood that one of your clients would die before their time, resulting in a life insurance payout, which could increase AUM.  The small cost to the client (and temporary loss of AUM growth due to increased deposits), can result in a large windfall for the spouse of a client and/or children, and much larger AUM fees. 

For example, I just had a client die.  She had about $2MM.  I knew she had cancer, and was working with her daughters and her (one is hot, the other is not), and estate attorney.  When she passed, her life insurance paid out an additional $1 million.  If I have no more clients die, this particular clients premiums paid for the potential loss in income.

Now, that is the shitty, greedy advisor talking.  However, it was also the right thing to do for her kids for various reasons.
I come in peace. I didn’t bring artillery. But I’m pleading with you, with tears in my eyes: If you fuck with me, I’ll kill you all. - General James Mattis

Fiduciary as Fuck - iMo
Back to Top
luvindy View Drop Down
Moderator
Moderator
Avatar

Joined: May/17/2010
Status: Offline
Points: 25767
Post Options Post Options   Thanks (0) Thanks(0)   Quote luvindy Quote  Post ReplyReply Direct Link To This Post Posted: Jun/09/2017 at 9:48am
Originally posted by socalfa socalfa wrote:

Originally posted by bagua bagua wrote:

Socalfa this isn't a shot at you. It's an interesting question and I am interested in what you are hearing in your office. My understanding is that as an "Agent" of the insurance company you cannot be a fiduciary. Those two roles are mutually exclusive. You have a duty as an "Agent" to the company. You are empowered to bind coverage on the part of the company with the applicant. That power comes with the obligation to protect the interests of the company. You can't put anyone's interest before the agency. Not yours, not the clients, not your Momma.
  This has fuckall to do with your ability or interest in taking care of your clients. You may be right on the line of putting your client first, but the company, by virtue of the Producer contract you signed, has first dibs on your attention.
 
That's how I understand it. I was only a career agent for 4 or 5 years, so I could be wrong. Interested in your thoughts.
 
Bagua

No offense taken....

In terms of the recommendations made, anything that remotely resembles an asset or investment gets passed through compliance to verify "best interest of the client" (only exception to this being term life, as far as I know). This includes products that would not be considered investments but are a savings vehicle (e.g. permanent indexed or whole life policies).

In theory, I could never sell a single insurance product and make my validation. Comp from A Shares or advisory accounts all goes towards my benefits-eligible compensation. In practice, doing insurance/annuity makes up a large part of my BOB because (a) protecting against the risk of dying too soon or living too long is an important part of many clients' financial plan, and (b) life insurance pays well.

As a mild jab at the "RIA fiduciary purists" -- if your only compensation comes from asset management fees, does that not give an incentive to ignore or downplay necessary life insurance coverage, because every dollar into a premium is a dollar not going into a wrap account? In terms of making a comprehensive financial plan, that seems like a potential conflict of interest.


Do you have insurance sales requirements to keep your job?


8/31/12,Sportsfreak:
"If Barak wins this election, or appears to be clearly winning, we are all fucked. Market will tank big time."
Dow 13,090 S&P 1406
5/23/13 UC:Dow 20k before 20% crrectn Dow 15,
Back to Top
socalfa View Drop Down
Greenhorns
Greenhorns
Avatar

Joined: Jun/08/2017
Status: Offline
Points: 35
Post Options Post Options   Thanks (0) Thanks(0)   Quote socalfa Quote  Post ReplyReply Direct Link To This Post Posted: Jun/09/2017 at 1:10pm
I could do entirely brokerage/IAR work and keep my job. Sales requirements are not product-specific.
Back to Top
 Post Reply Post Reply
  Share Topic   

Forum Jump Forum Permissions View Drop Down

Forum Software by Web Wiz Forums® version 12.03
Copyright ©2001-2019 Web Wiz Ltd.

This page was generated in 0.094 seconds.