All Brokers should maintain sufficient information in Client Files to demonstrate the appropriateness of any sale or any advice given. It is extremely important that you retain all material information that was utilized in the sales process as well as the maintenance or servicing of a policy/contract. Accurate and secure records will help to:

• Demonstrate that you fulfilled your duty of care,
• Avoid any possible breach of client’s privacy and confidentiality,
• Defend against allegations of misconduct,
• Provide ongoing service to clients,
• Add value to your business and your relationship with the client.

A CEM is not simply defined as an e-mail communication but rather a text or SMS message, for example, can also be identified as a CEM. An e-mail offering potential clients a free consultation of their financial well-being could be viewed as commercial activities. Statutory exemptions exist:

• between individuals who have a personal or family relationship
• if a Broker receives a referral about a potential new client, from someone who has an existing relationship with both Broker and prospect, the Broker can send one introductory message to that prospect
• where there is an “active” existing business relationship. “Active” is defined as within a 2 year period from purchase or within a 6 month period since last service provided.
• where the recipient visibly publishes their electronic address without stating it does not welcome CEMs
• where you are handed the persons business card containing their electronic address

Maintaining good client files will help to clearly indicate how your recommendations met the client needs and mitigate any conflicts of interest that may arise from the sale of an insurance product. At minimum, a well-documented Client File will include the following:

• Consent to collect and retain personal information,
• Know your client worksheets,
• Personal and any product specific disclosure documents,
• Evidence of needs analysis
• Copies of illustrations (signed by client where appropriate)
• Notes of client meetings

We encourage you to refer to HUBLINK for assistance in creating your own personalized document package you may incorporate in your sales process.

Records include all stored information including physical or electronic documents. 

Remember,
Good Business is Compliant and Compliance Matters!