A fiduciary is an expert in the services provided. So a fiduciary has a legal responsibility for your welfare.

  • fiduciary has scope to exercise some power or discretion
  • fiduciary can unilaterally exercise of power or discretion in a way that affects the beneficiary‚Äôs legal or practical interests
  • the beneficiary is vulnerable to or at the mercy of the fiduciary

An agent has a position of financial trust and must

Advisor: discretion, power, special skills
You: trust in advisor, vulnerability

Advisors licensed to sell life insurance have a legal responsibility for your welfare for the services they provide because they have more knowledge and expertise than you do regarding insurance.

An advisor is required to

  • advise honestly and in good faith
  • disclose the potential or real conflicts of interest
  • perform duties
    • diligently
    • competently
    • professionally
    • maintain confidentiality

Fiduciary Duty

  • you expect your advisor to act on your benefit
  • your advisor has legal responsibility for your welfare for the services provided
  • responsibility of confidentiality and trust since the advisor has more knowledge and expertise about insurance than you do
  • creates a fiduciary relationship between the parties, as with
    • lawyer/client
    • doctor/patient
    • parent/child

This brief summary cannot capture the variations for

  • different designations
  • different jurisdictions

This is primarily for residents of Ontario, Canada.

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