Regulations for Financed Sales

Financed sales are replacements funded by borrowing or withdrawing from an existing policy.  Financed sales, “internal replacements,” and their related sales practices are closely monitored by regulators and providers.  Before recommending a financed sale, take special care to determine whether it is appropriate. Carefully document that the client understands the costs of “financing” and the effect on the existing policy.

Disability Product Requirement

To sell this product, the following is required:

  • A disability, health, or accident/sickness license (depending on the state).
  • Company appointment.

Fixed Annuity Product License Requirements

The following requirements should be met for this product:

  • Life license in the state of sale and the client resident state.
  • Company appointment in the state of sale and the client resident state.

Group Annuity Product Requirements

While this is filed as an insurance product, some states may consider it to be registered, therefore requiring FINRA registration and a variable license (if state required).  Contact Provider Company for Licensing Requirements.

Term Life Product License Requirements

The following requirements should be met for this product:

  • Life License in the state of sale and the client resident state.
  • Company appointment in the state of sale and the client resident state.

Universal Life Product License Requirements

The following is required for sale of this product:

  • Life License in the state of sale and client’s resident state.
  • Company Appointment.

Whole Life Product License Requirements

To sell this product, n Member must have the following:

  • Life license in the state of sale and client’s resident state.
  • Company appointment.