State RegulationsTN specificDifficulty 3/5
Which description best captures the care obligation a Tennessee producer owes when recommending an annuity contract?
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Answer & full 3-part explanation (select an option above, or peek)
Why C is correct
Tenn. Comp. R. & Regs. 0780-01-86 imposes a care obligation: before recommending an annuity, the producer must make reasonable efforts to obtain the consumer's suitability information and base the recommendation on the consumer's financial situation, insurance needs, and financial objectives. The Tennessee Department of Commerce & Insurance expects the recommendation to rest on that profile, not on habit or convenience.
Why the other options are wrong
- A) Age alone is a sliver of the profile; the care obligation demands a view of finances, needs, and objectives, not a single data point.
- B) An agency's preselected product list is not a substitute for the consumer-specific analysis the rule requires.
- D) A one-size rule about surrender charges is mechanical, while the rule requires tailoring the recommendation to the consumer's actual profile.
Memory hook
Care = know the consumer first: finances, needs, objectives — then recommend.