15 - Why should I buy investments from a life agent?

Question 1

What are the 7 areas of knowledge for “knowing your client?”

Answer 1

1. Investment objectives
2. Risk tolerance
3. Inflation protection needed
4. Time horizon
5. Liquidity needs
6. Marginal tax rate (MTR)
7. Timing strategy

Question 2

What are the 5 areas of fiduciary responsibility?

Answer 2

1. Dependence on information provided
2. Confidentiality
3. Professional standards
4. Advise fully, and honestly
5. Meticulous records of work

Question 3

What are the 4 pillars of our financial system?

Answer 3

1. Insurance companies
2. Banks
3. Trust companies
4. Investment dealers and stockbrokers

Question 4

What is the difference between mutual insurance and stock insurance companies?

Answer 4

Mutual insurance companies are owned by the policy holders.

Stock insurance companies are owned by the share holders.