New Jersey Life Insurance Exam Practice Question
In order to receive fees other than commissions from a life insurance prospect, an insurance producer acting as a consultant must FIRST
Correct Answer: C
Rationale: To receive fees beyond commissions, an insurance producer must first secure a signed written memorandum from the prospect, clearly stating the amount of compensation. This ensures transparency and compliance with regulatory standards.
Option A is incorrect because presenting a Notice Regarding Replacement of Life Insurance form pertains to disclosure about replacing existing policies, not about fee arrangements.
Option B is also incorrect; the Comparative Information form is used to compare policies, not to establish compensation agreements.
Option D is misleading, as obtaining a commitment to purchase insurance does not address the requirement for fee disclosure and agreement.
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