This issue first came to light in 1998 as CL22 (Circular Letter) which was issued in response to complaints from large business internal risk manager complaints about up-front contingencies that big brokers were taking. The issue had nothing to do with main street brokers then and it should have been put to bed in 1998. There are laws that state that all licensees should act in a trustworthy manner which provides regulators plenty of power to effectively protect the public. This new measure simply allows another opportunity for regulators to fine producers for failing to follow the fine print and spend valuable time reviewing disclosures rather than counseling clients on their individual needs and coverages.
This issue first came to light in 1998 as CL22 (Circular Letter) which was issued in response to complaints from large business internal risk manager complaints about up-front contingencies that big brokers were taking. The issue had nothing to do with main street brokers then and it should have been put to bed in 1998. There are laws that state that all licensees should act in a trustworthy manner which provides regulators plenty of power to effectively protect the public. This new measure simply allows another opportunity for regulators to fine producers for failing to follow the fine print and spend valuable time reviewing disclosures rather than counseling clients on their individual needs and coverages.