Tony Vidler has a series of challenge questions for advice suitability in this piece. His list is focused on an investment advice situation, below is my version, focused on an insurance advice situation.
- Does the advice address the scope agreed between you and the client?
- Did you gather sufficient information to ensure suitability?
- Is the advice consistent with evidence-based approaches or academic consensus about this problem?
- Is the advice, or recommendations, based upon research and analysis?
- Is the balance between risk retention and transfer consistent with client tolerance for risk?
- Does this take into account existing resources and/or insurance? If not, why not?
- Has client desire to either consume or maintain capital been considered?
- What assumptions or calculations underpin it?
- is the ownership structure appropriate, and have all existing ownership entities been captured and considered?
- are their specific tax liabilities or advantages which are material to the recommendation? If so, what impact would a change in the taxation position have upon the recommendation?
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