New Jersey Life Insurance Exam Practice Question
For a New Jersey producer to charge a prospective insured for analyzing coverages, there must be a reasonable relationship between the fee and the
Correct Answer: A
Rationale: Charging a fee for analyzing coverages must reflect the nature of the service performed. This ensures that the fee is justifiable and correlates with the complexity and extent of the analysis provided to the prospective insured.
Option B is incorrect as it suggests a link to total commissions, which is unrelated to the service quality or analysis performed. Option C is also wrong because the average face amount of policies does not directly relate to the analysis service. Lastly, option D misguides by implying that the average of policies analyzed determines the fee, rather than focusing on the specific service rendered.
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