By now, everyone in the financial services industry knows about the U.S. Department of Labor’s fiduciary rule and is figuring out how to adjust and comply with the new regulations. Annuity agents and advisors have a tough road ahead of them.
Here’s some advice from Shawn Sparks, the author of "The Advisor Breakthrough, Your Step-By-Step Guide to Building a Million-Dollar Practice.” He’s been a consultant to financial services leaders for more than a decade.
In an article published in ThinkAdvisor, Sparks says advisors and agents should follow a set process to determine the best products for their clients. Then, annuity salespeople should document the process they use and the rationale and justifications for their recommendations. Agents have to do this anyway by law -- saved for at least six years.
Sparks says advisors should ask themselves two key questions when it comes to their clients: “1. If you were put on the stand and asked why you recommended a specific product or to your client, would your claims hold up? 2. Can you validate your claims with documentation that you took at the time you made the recommendation showing your due diligence?”