User:Tvrobertson/sandbox/Fiduciary Insurance Adviser

Fiduciary Insurance Advisor (FIA) The Fiduciary Insurance Advisor is a professional designation that is electable by any professional advisor with an underlying related professional designation. For example, a CLU (Chartered Life Underwriter), a CPCU (Certified Property Casualty Underwriter), a CFP (Chartered Financial Planner), etc., or an Attorney, or CPA who wishes to elect to self-identify as a fiduciary with specific knowledge regarding an area of insurance coverage design. It is simply a self-declaration of fiduciary standard of duty in the conduct of assisting clients usually in conjunction with other professional advisors, such as Trustees, Attorneys, CPAs (Certified Public Accountants), etc.

Essentially, the person who identifies himself or herself as a Fiduciary Insurance Advisor is declaring a higher standard of professional conduct that has legal consequences. I.e. Legally, "A fiduciary owes the duty of loyalty, full disclosure, and due diligence to the principal and must not exploit his/her position of trust and confidence for personal gain at the expense of the principal without disclosing such. The law demands a fiduciary to exercise the highest degree of care and utmost good faith in the maintenance and preservation of the principal's assets and rights, and imposes compensatory as well as punitive damages on an erring fiduciary."

Most insurance agents are NOT fiduciary advisors and yet have significant control over how they design the contracts they propose to clients. Additionally, most products today have a “range” of commission levels to use in their design. As one would imagine, a lower commission in a cash value life insurance policy, for example, will often (not always) impact the clients’ contract values positively, especially in the early years. Yet, this may generally NOT fit a non-fiduciary agent’s personal agenda, seeking higher compensation.

By declaring as a Fiduciary Insurance Advisor, an agent is legally required to "tweak" the design of each proposal optimally in favor of the client(s), regardless of the impact on his/her compensation profile, and further to disclose such compensation to the client and professional advisors involved. The FIA can perform objective fee-based analysis of existing or proposed insurance coverage to help other professional advisors understand the possible design options proposed by non-fiduciary agents, and that may improve the clients position in some manner. Further the FIA can offer the same objective guidance while performing the "tweaking" process in return for commissions offered by the insurer within the regulatory product filing which have been tweaked optimally in the client's best interest along with other design elements.

Of course, the advantage of such election by the declaring advisor is to increase his/her value to the client and to the other advisors by providing written due diligence for their files, and thereby assure the highest fiduciary standard of conduct available within the regulatory filing of a carrier's product while still being compensated by the insurer rather than a fee from the client. The advantage to the client results in a lower cost overall than having the same optimal commission (or higher) paid to a non-fiduciary agent, and then also paying an oversight fee to the FIA to assure fiduciary compliance. In this scenario, the fee becomes unnecessary while still remaining within the fiduciary duty of care.

In short, the FIA is declaring that he/she will always act in the client's best interest, and this declarative action secures the integrity of the promise with teeth - defined damages with the law under the definition of fiduciary duty.

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