Several problems with the way life insurance is sold and serviced by life insurance agents frustrate consumers and lead to costly mistakes. The following factors create consumer uncertainty and suspicion that insurance recommendations are primarily designed to benefit the agent.
Traditional agents and “independent” brokers do not serve as a client’s “fiduciary,” i.e., a trusted advisor required to put the client’s interest first. They do not disclose commissions or attempt to minimize them. They only discuss products of companies with which they are licensed. And they do not suggest or consider the possibility of a no-commission alternative.
All of these problems and conflicts with typical life insurance sales should make it clear why more and more smart consumers recognize that the only dependable source of unbiased advice about life insurance is an advisor who is a fiduciary – one who puts the client first and can assure that all the best options and alternatives are considered, regardless of the compensation impact on the advisor.