Optimize yourOutcomesChoosing Between Insurance Agents,Brokers, and Registered Investment AdvisorsFinancial Advisors: ChoosingBetween Insurance Agents,Brokers, and RegisteredInvestment AdvisorsHow to find the best fitInfinium Investment Advisors www.infiniumadvisors.com
Optimize yourOutcomesChoosing Between Insurance Agents,Brokers, and Registered Investment AdvisorsFoothills Park, near Palo Alto, CAFinding the best financial advisor to suit yourneeds is not easy, but the effort is worth it.Thirty years ago, investors relied onstockbrokers for information like a stockquote. With the astounding amount ofinvestment advice available today, thework of financial professionals has changedquite a bit. The old stockbroker model hasbeen destroyed as investors not only seekvaluable opinions, but also financialsolutions, comprehensive financialplanning, and honest advice.Insurance agents in today’s marketplacehave a broader selection of products thanin prior years, such as proprietary mutualfunds, but their ultimate focus is insurance.Insurance products are generallyconsidered very low risk, and also generallyprovide very low returns.As investors look at a crowded field offinancial professionals, how can they beginto make a decision to rely on the advice ofone professional over another? Investorsshould begin their search for solutions andadvice with an understanding of thesimilarities and differences between thethree types of investment advisors intoday’s marketplace.A broker’s job is to sell securities to investorsand work as a liaison or agent for largebrokerage firms. Traditionally, brokers arepaid on commission for the securities theyhelp their clients buy or sell. Brokers canoffer almost any type of investmentopportunity to their clients, but usually try tosell their firms proprietary offerings asopposed to similar securities created byother firms. Many brokerage houses alsooffer fee-based models, which means theycharge a flat fee for service and alsoreceive a commission for specific products.In many cases, brokers have special accessto their own firm’s products, and sometimesthey are encouraged to sell these productsfor bonuses or additional commissions.What is an Insurance Agent?An insurance agent’s primary role is to sellinsurance products and annuities to clients.Insurance agents are compensated bycommissions based on the insuranceproducts they sell. In addition tocommissions, agents can receive “trails” –ongoing payouts taken from the often highannual fees of insurance policies.What is a Broker?2Infinium Investment Advisors www.infiniumadvisors.com
Optimize yourOutcomesChoosing Between Insurance Agents,Brokers, and Registered Investment AdvisorsKeebler Pass, near Crested Butte, CORIAs are not compensated for selling specificproducts and do not receive commissions.What is a Registered Investment Advisor(RIA)?Registered Investment Advisors (RIAs) offerinvestment advice to clients in return for afee. These fees are usually assessed on anhourly basis or as a percentage of assetsunder management. RIAs are notcompensated for selling specific productsand do not receive commissions.The most striking difference betweeninsurance agents, brokers, and RIAs is thatonly RIAs are held to a fiduciary standard.As fiduciaries, RIAs are obligated to putclient interests first. This means only makingrecommendations that are in the bestinterest of the client. In contrast, insuranceagents and brokers are held to a suitabilitystandard. This means that they canrecommend any investment to a client solong as it is “suitable” – therecommendation does not necessarilyneed to be the best choice for the client.Working with an Insurance Agent forinvestments and financial planning:Insurance agents can have a tendency tobe product focused rather than solutionsoriented. Insurance agents are paid on acommission basis for the products they sell.In many cases, they have strong incentivesto sell their own company’s insurancepolicies. Insurance agents can tend to usefinancial planning as a tool to understandwhich insurance product they can fit to aclient’s given situation, withoutconsideration for other investment options.Unfortunately, insurance agents may findthemselves beholden to the old saying, “Toa man with a hammer, everything looks likea nail.” While insurance is a very importantpart of financial plans, most insuranceproducts are simply less efficient when itcomes to true investment strategies.Many insurance agents market expensivelife insurance products such as whole life orvariable life policies. While many of themgo about this with good will, most peoplesimply need inexpensive term life insuranceand a strong investment plan that is nottied down to an insurance policy.Insurance products tend to be the mostexpensive financial products in themarketplace. Investors using insuranceagents for investments and financialplanning may see poor performance fromsimple insurance products while they payindustry-high fees.3Infinium Investment Advisors www.infiniumadvisors.com
Optimize yourOutcomesChoosing Between Insurance Agents,Brokers, and Registered Investment AdvisorsTaylor River, near Gunnison, CORIAs are different from other financialprofessionals because of their duty to theFiduciary Standard.Working with a Broker for investments andfinancial planning:To a certain extent, brokers have similarincentives as insurance agents. Most largebrokerage houses encourage their brokersto sell specific offerings, and even brokerswho receive most of their compensationthrough a fee-based structure can receivespecial commissions for selling particularproducts.While insurance agents can be overlyfocused on insurance policy solutions,brokers can be too focused on playing themarket, or finding the “hot picks.” Ratherthan looking at a complete financial planand an individual investor’s risk tolerance,brokers can become so concerned with“beating the market” that theyrecommend hedge funds, structured notes,and other complicated products thatprovide commission for themselves andtheir firm. While their aim to help their clientsmake money is good, this approach canload up a portfolio with inappropriate riskand complex financial instruments that aredifficult, if not impossible, to liquidate in anemergency.Working with a Registered InvestmentAdvisor for investments and financialplanning:RIAs are different from other financialprofessionals because of their duty to theFiduciary Standard. This standard is definedby federal law and requires RIAs to put theirclient’s interests ahead of their own.Since RIAs are usually independent they donot have proprietary products,complicated corporate bureaucracies, orsales incentives. This means that an RIA isfree to focus on his or her clients’ plans andgoals rather than on a large corporation’sbottom line. While an insurance agentmight receive a bonus for selling her firm’snewest policy riders and a broker mightencourage all clients to purchase his firm’snew credit card, a RIA does not have thesedistractions. Because of their fee-basedpay structure, a RIAs interests are alignedsolidly with their clients’.4Infinium Investment Advisors www.infiniumadvisors.com
Optimize yourOutcomesChoosing Between Insurance Agents,Brokers, and Registered Investment AdvisorsGolden Gate Bridge, San Francisco, CAThe best financial advisors are true consultants to theirclients.Of the three types of financial professionals, RIAstend to provide their clients with the mostcomprehensive and dynamic financial plans onthe marketplace. Because of the seriousresponsibility of the fiduciary standard theseplans cannot simply be glorified net worthstatements or tools to match clients to insurancepolicies. RIAs rely upon comprehensive financialplanning to help them determine whichinvestments and advice are truly in a client’s bestinterest.In addition to more robust financial planning,RIAs can offer a wider universe of investmentopportunities for clients. An RIA can design acustom portfolio suited to each client’s specificneeds and goals, and does not need torecommend certain investments to ensure acommission. This is a strong contrast to beinglocked into a limited number of proprietary fundsavailable inside a variable insurance policy, orconfined to investment models designed by abrokerage house’s strategy team.Every investor has to determine his or her owngoals and investment philosophies. Sometremendously risk-averse individuals might bewilling to pay for an insurance-based portfolio.Some individuals might feel a level of comfortinvesting with a large brokerage house with afamiliar logo and a household name. But allinvestors should be aware of the significantdifferences between insurance agents, brokers,and RIAs so that they can choose the financialprofessional that they believe will best servetheir goals and needs.5Infinium Investment Advisors www.infiniumadvisors.com
Optimize yourOutcomesChoosing Between Insurance Agents,Brokers, and Registered Investment AdvisorsFor more information, contact Infinium Investment Advisors at:email@example.comDenver Office (Headquarters)50 South Steele Street #830Denver, CO 80209(720) 253-1818Silicon Valley Office530 Lytton Ave., Flr 2Palo Alto, CA 94301(650) 353-2315Cover photo: Robert Mondavi Winery, Napa Valley, CAFor Informational Purposes OnlyThis presentation contains general market news and concepts in wealth management for informational purposes only and isnot intended to be either an offer or solicitation by any Infinium Investment Advisors, LLC entity or related parties to sell or buysecurities or strategies, or a specific invitation for a consumer to apply for any financial product or service that may beavailable through Infinium Investment Advisors, LLC. Infinium Investment Advisors does not provide tax or legal advice. Alwaysconsult your personal financial advisor before making any investment decision. Information regarding specific products orservices is available upon request.Copyright Infinium Investment Advisors, L.L.C.
insurance agents, brokers, and RIAs is that only RIAs are held to a fiduciary standard. As fiduciaries, RIAs are obligated to put client interests first. This means only making recommendations that are in the best interest of the client. In contrast, insurance agents and brokers are held to a suitability standard. This means that they can
Massachusetts 02199 with an additional office at 101 Second Street, Suite 1600, San Francisco, California 94105 to support the services offered by its divisions. Natixis Advisors has two divisions Managed Portfolio Advisors ("MPA") and Active Index Advisors ("AIA"). Neither MPA nor AIA is a separate legal entity. Natixis Advisors and
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Overall, CRM software was most widely adopted among financial advisors (85.7% adoption), followed by financial planning software (83.0% adoption). Although, notably, this did differ by channel, with CRM being most widely used among advisors in the BD channel - versus financial planning software being most widely adopted among
BMO Harris Financial Advisors, Inc. Form ADV Part 2A 4 of 35 Item 4 - Advisory Business Description of Firm MO Harris Financial Advisors, Inc. ("HFA" ) is a wholly-owned subsidiary of BMO Financial Corp., whose parent company is Bank of Montreal. BHFA is headquartered in Chicago, Illinois, and was formed in August, 2005.
Foy Insurance of MA, LLC 198 Frank Consolati Insurance Agency, Inc. 198 County Insurance Agency, Inc. 198 Woodrow W Cross Agency 214 Woodland Insurance Agency, Inc. 214 Tegeler Insurance Services of CT, Inc. 214 Pantano/VonKahle Insurance Agency, Inc. 214 . Hanson Insurance Agency, Inc. 287 J.H. Slattery Insurance Agency, Inc. 287
113 Soltis Investment Advisors St. George, Utah 1,064,402 814 23 13 114 Legacy Wealth Management Memphis, Tenn. 1,056,854 2,328 21 17 115 Trumbower Financial Advisors Bethesda, Md. 1,040,372 659 11 5 116 Pittenger & Anderson Lincoln, Neb. 1,036,299 813 8 8 117 Cardiff Park Advisors Carlsbad, Calif. 1,034,926 1,457 4 1
AIB works with individual advisors, as well as with insurance agencies, financial planning firms, benefit brokers, banks and credit unions, broker dealers, wire houses and others. By extension, they help each of them—and their affiliated advisors—to help their individual and group clients, including businesses, colleges
Bank Staff Legal Advisors Family & Friends Medical Advisors Accountants Financial Advisors Protect yourself from financial abuse. Talk about financial matters with trusted family and friends. Keep track of your finances by checking your bank statements regularly to make sure there have been no unauthorised transactions. Talk to the bank if there