YOUR mOST ImPORTANT FINANcIAl dEcISION- Variable Annuity license This allows the agent to sell variable
annuity products, provided that the agent also holds the FINRA
Series 6 or Series 7 licenses described earlier.
Like stockbrokers, Insurance Agents’ licenses are held with one or more
insurance companies. And, like stockbrokers, agents legally represent
the insurers, not their customers. Also like stockbrokers, agents earn
commissions from the sale of products; they do not give or earn fees for
rendering advice.
“Captive” agents are employees of a particular insurance company.
These agents sell that company’s products only, similar to how sales-
people at Ford dealers only sell Ford automobiles.
“Independent” agents operate their own businesses or work for a gen-
eral agent. Independent agents hold their licenses with many insurance
companies, giving them access to a wider product line.
To make it even more complicated, some insurance companies employ
their own agents while also allowing independent agents to sell their
products.
InvestMent ADvIsoR RePResentAtIvesUnlike Registered Representatives and Insurance Agents, an Investment
Advisor Representative represents and works for you instead of a Wall
Street firm or insurance company. In fact, Investment Advisor Represen-
tatives have a “fiduciary duty” to serve your best interests. They have a
legal responsibility to do what is best for you. This is in sharp contrast
to a Registered Representatives or Insurance Agents whose duty is to a
home office. An Investment Advisor Representative must hold one of
the following FINRA licenses:
- Series 65: Uniform Investment Adviser Law license: Before
practicing, the Investment Advisor Representative must also
obtain the Series 63 state license. - Series 66: Uniform Combined State Law license: This license
combines the Series 65 and Series 63 into one examination.
The SEC regulates Registered Investment Advisory firms and their In-
vestment Advisor Representatives. Each state also regulates Investment