What is a financial advisor's responsibility to clients?

By Lew Nason

Insurance Pro Shop


In a recent comment to one of my articles on ProducersWeb, an advisor asked “What is our responsibility to the purchasers of the annuities we promote and sell to contribute to that purchaser's successful ownership experience?"

Here is my reply:

Financial advisor’s commitment to moral and ethical conduct

As members of one of the oldest and most important financial services professions, we recognize that we have certain obligations to our clients and the companies we choose to represent.

We believe it is our moral and ethical responsibility to:
  • Identify and represent only financially strong companies with a solid history of actual product performance.

  • Know and understand the insurer’s products and their uses.

  • Keep ourselves informed with respect to applicable laws and regulations and observe and abide by them in the practice of our profession.

  • Perfect our skills and increase our professional knowledge through the use of continuing education programs and membership in our local industry professional organizations.

  • Identify the needs and wants of our clients, to help them protect their interests and achieve their financial goals.

  • Maintain strictest confidence, and consider as privileged, all business and personal information pertaining to our clients’ confidences.

  • Consider the needs and financial objectives of our clients first.

  • Recommend replacement of existing products only when it is clearly in our clients' best interest.

  • Present accurately and honestly all the facts essential to our clients’ decisions, recommending products that are best suited to our clients’ needs and risk tolerances.

  • Discover and disclose relevant information to the company and our clients.

  • Provide outstanding service to our clients after the sale.

  • Conduct our business as a role model for others in this business.

  • Respect fellow agents and not disparage our competitors.