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Best Interest Regulations for Financial Institutions

Feb 13, 2020 10:16:48 AM

Best interest standards regulations are sweeping across the country. But do they have different implications for different types of life insurance practitioners? In the video below, we explain the changing role of financial institutions and how best interest regulations come into play. Check it out!

To learn more about Regulation Best Interest, visit our Reg BI resources page.


Over the years, financial institutions’ roles have shifted from merely executing trades and taking product orders to actively providing investment advice. Consequently, client expectations of their advisors are increasing. Clients want their advisors to be more trustworthy, knowledgeable, and accessible than ever.

Those enhanced expectations have led to more federal oversight, with regulations being enacted, such as the SEC Best Interest Rule, the SEC CRS, and the CFP Fiduciary Standard. All these regulations were designed to ensure that advisors act in the client’s best interests.

Under these regulations, advisors are obligated to act as fiduciaries and only make product recommendations that can easily be tied back to the following three key elements:

  • 13 key customer suitability data points that need to be documented and kept current;
  • Client-specific and suitable based on goals and risk tolerance, and;  
  • Fair and accurate presentation of products to inform the consumer of the various features and consequences of the product, both favorable and unfavorable.

To discover how Proformex supports client best interest regulations, visit our website and schedule a demo.

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