Paraphrasing the famous quote by Supreme Court Justice Potter Stewart, most of us “know it when we see it” when contemplating the possibility and consequences of risk, but the definition of risk may not glibly roll off the tongue. We need to understand a client’s sensitivities to risk in order to move to the next level of planning. Risk tolerance is a fundamental determiner of suitability for investment products, and is similarly the appropriate springboard for answering “what kind of policy should I buy?”
Author: Richard M. Weber, MBA, CLU, AEP (Distinguished), is well known by insurance agents for his activities on their behalf in the area of life insurance “due care.” He received the Kenneth Black, Jr., Leadership Award in 2008 in recognition of his “exemplary leadership qualities and significant contributions to the fulfillment of the Society of Financial Service Professionals core values of ethics, education, and relationships.” He is president of The Ethical Edge, Inc., Pleasant Hill, CA, consulting to insurance companies and agents on issues of product expertise and the appropriate use of technology. A past president of the Society of Financial Service Professionals, Mr. Weber has written hundreds of articles and delivered presentations throughout the industry on “…increasing earnings while maintaining high levels of integrity and ethics.”
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