What must an insurance producer do to sell a variable life insurance policy?

To sell a variable life insurance policy, an insurance producer must obtain specific licensing and training because these products involve investment components and are regulated as both insurance and securities. This dual requirement means that producers need to hold a life insurance license and a securities license, typically passing the Series 6 or Series 7 exam, depending on the specific responsibilities involved in selling these products.

Providing a detailed risk assessment to clients is also essential when selling variable life insurance. This type of policy allows policyholders to invest the cash value in various investment options, which introduces market risks that must be thoroughly explained. Understanding the risk tolerance and financial goals of clients is necessary to ensure that the chosen investment aligns with their objectives.

Ensuring compliance with state regulations is an ongoing requirement in the insurance industry. Each state has specific laws governing the sale of variable policies, including disclosure obligations and suitability requirements. Adhering to these regulations protects both the insurers and the consumers, ensuring fair practices in the industry.

Therefore, fulfilling all these requirements is crucial for an insurance producer to legally and ethically sell variable life insurance policies, confirming that the answer encompasses all necessary actions a producer must take.