Series 7

[Newby]

And yet some CPAs and Attorneys seem pretty free to give insurance advice without proper certification...

I get a chance to talk with a lot of CPAs. My wife is a CPA and we attend conventions for CPAs a couple of time a year. This results in having dinner at a round table with 8-12 CPAs and a lot of discussion about what I do (since what they all do is so boring to talk about).

I can tell you with no hesitation at all...CPAs don't know any more than the general public about any form of insurance. They are intelligent people and are teachable. But they do have an inflated sense of what they know and I mean they don't know even the very basics.

There are exceptions of course. Some of them become very involved in insurance and would learn just like any other agent learns.

In my experience attorneys are about the same. They have inflated credibility with your clients but their knowledge is generally very basic and often tainted.

 

[sman]

And yet some CPAs and Attorneys seem pretty free to give insurance advice without proper certification...

I didn't say otherwise. I just pointed out what the rules are. That doesn't mean I necessarily agree with them in their totality. For example, I know plenty of the tax laws and I will share that with clients (i.e. - how something may impact them from a tax standpoint), but I always follow that up with "I am not a tax professional and I suggest you talk to a tax professional before acting on anything".

 

[Norwayguy]

I understand the issue of certification. I just don't see the big deal if client is interested in our products. We shouldn't have to tip toe around and apologize any more than those that are securities licensed. Our products are completely different in nature....safety of principle vs market risk.
Problem is that clients aren't given these options up front from their trusted financial planner and clients just expect that risk is essential to making money and they are also brainwashed into thinking insurance is a waste of money.

There is nothing stopping you from explaining your product. The issue (and I say this as a former registered rep) is you can NOT explain the security....I know I ask allowed why I can not open the prospectus and point out what is written thier.

 

[Tahoe Ray]

I didn't say otherwise. I just pointed out what the rules are. That doesn't mean I necessarily agree with them in their totality. For example, I know plenty of the tax laws and I will share that with clients (i.e. - how something may impact them from a tax standpoint), but I always follow that up with "I am not a tax professional and I suggest you talk to a tax professional before acting on anything".

I agree with you and do the same thing...it was just an observation.

 

[xrac]

There is nothing stopping you from explaining your product. The issue (and I say this as a former registered rep) is you can NOT explain the security....I know I ask allowed why I can not open the prospectus and point out what is written thier.

We can not read and explain a prospectus but the registered rep can say what they want to about whole life insurance with impunity.

 

[Baconfat]

I just can't wrap my head around what's wrong with us as insurance advisors educating people about alternative places for their retirement. How is there more harm in an fixed/indexed annuity vs mutual funds? Is there harm if client gains 7% in annuity with cap when they could've earned 10% in market with also 100% risk?

Surrender schedule is one reason there may be more harm in FAs/FIAs.
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We can not read and explain a prospectus but the registered rep can say what they want to about whole life insurance with impunity.

Wouldn't it be safe to say that most registered reps also hold life/health insurance licenses?

 

[jmarkk1]

I'm fully aware of surrender charges...still don't see how they are worse than what can happen in market.
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I think the real issue is that securities people and insurance people are at odds...registered reps may be licensed for life, etc but they think the market is best place for clients money.
At the end of the day, I think client needs to know truth of both options and then decide.
If they want risk...so be it....if they want safety and growth...so be it

 

[xrac]

Surrender schedule is one reason there may be more harm in FAs/FIAs.
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Wouldn't it be safe to say that most registered reps also hold life/health insurance licenses?

Do wirehouses RRs have L/H license? Frankly, I don't know.

 

[LGilmore]

Right now I am thinking about bringing my license back out of mothballs (couple months).

I think it comes down to this, if you are talking about anybody else's product, better know your s ht. FINRA can bellow all they want, but if you're not wrong, they don't have much of an actionable position.

Besides as they taught us in Securities sales "if this were my investment I would....."

 

[Baconfat]

I'm fully aware of surrender charges...still don't see how they are worse than what can happen in market.
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I think the real issue is that securities people and insurance people are at odds...registered reps may be licensed for life, etc but they think the market is best place for clients money.
At the end of the day, I think client needs to know truth of both options and then decide.
If they want risk...so be it....if they want safety and growth...so be it

Depends on the clients objectives. What happens if the insurance company falls below their claims paying ability...that's a risk too....albeit a very small risk

I'm a registered rep and approach my clients by protection of assets via life/disability/ LTC but can also move assets over if the level of mutual respect is there or the client out right knows what they want to do. It doesnt have to be one or the other or one license vs another. And like you said I let the client decide what is right for them. Personally, I believe I am only there to guide them to the facts and comparisons they need to make an informed decision in the areas I am licensed to do so. They ask a tax question, I tell them I'm not a tax professional. They ask a legal question and I tell them I'm not a lawyer.