If an insurance regulator were to ask you the details of a recommendation you made to a client a year ago, could you provide them with the specifics they are wanting to know? Having specific information within your client files may help you should you be faced with those questions. Here’s a quick list to offer you a starting point of the items you might want to include in your files. Understandably, records may vary based on the situation and you’ll need to check the regulations in the states where you conduct business to be sure you’re meeting any specific state requirements for content and retention.
- Financial inventory
- Client fact finders or other client profiling documents
- Financial Professional’s notes
- Explanation for product recommendation(s)
- Details and notes from all client meetings
- Date of meeting
- Meeting location
- Individuals present
- Topics discussed
- Decisions made and the rationale
- Next steps
- Copy of illustration
- Copies of advertising and sales materials used
- Replacement forms/documents, if replacing another product
- Copies of all completed carrier forms (e.g., application, product disclosures, suitability form, etc.)
- Signed and dated contract/Policy Delivery Receipt
- Department of Labor PTE 84-24 Disclosure Form (for Qualified recommendations)
- Information or other disclosures provided to the client
- Notes on phone calls
- Retain copies of all email and other correspondence to/from client
- Any other documents pertinent to the sale of a product or your relationship with the client
Check out the Client Meeting Notes template that we’ve provided to help guide you through the documentation process.
For more information about keeping client records, read our Compliance Connection piece titled “One of Your Business’s Most Important Properties is Your Client Files”.
If you have questions regarding this or other compliance-related issues, send them to the Brokers International compliance team at ComplianceConnection@biltd.com. As your partner, we’ll assist you in keeping your advertising on the right side of the regulators.
This information is intended for Financial Professionals who are insurance licensed only. If you are securities licensed please contact your Broker Dealer for their requirements.
These educational pieces are intended to be informative and provide generalized guidance. They should not be construed as legal advice or provide protection against compliance violations brought on by a consumer or state insurance commission. It is the sole responsibility of the financial professional to seek compliance or legal direction specific to their individual situation. These pieces should be used as a means to raise awareness and evaluate business practices.
For Financial Professional use only, not for use with the general public. #18-0530-061119