What if I offer analytical and planning services to help my clients review their insurance options? Why do I need an insurance license to offer (and be paid for) this type of advice?
According to author Neil Alexander, CFP, it is not a good idea for CPAs to offer insurance analysis or advice services without proper licenses and full disclosure of compensation to clients. Here is part of what he wrote in The Journal of Accountancy (9/02): “When accountants review insurance transactions originated by others, the question of who pays their fees may come up. In California, for example, anyone who receives a fee from a client for insurance-policy-review services must have a life policy analyst license. If the fee comes from the insurance company, then the CPA is an insurance agent (and must be licensed as such) with proper disclosures to the client. CPAs cannot bill for reviewing insurance transactions on a client’s behalf without appropriate licenses. And free advice is often worth what the client pays for it.
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