State RegulationsVA specificDifficulty 1/5
Under Virginia's suitability rules for annuity transactions (14VAC5-45 of the Virginia Administrative Code), the producer's core duty when recommending an annuity is to:
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Answer & full 3-part explanation (select an option above, or peek)
Why B is correct
14VAC5-45 of the Virginia Administrative Code establishes the suitability framework for annuity transactions. Its core duty is that the producer have a reasonable basis to believe the recommended annuity is suitable for the particular consumer, based on that consumer's financial situation, needs, and objectives. The recommendation must fit the person, which requires gathering the consumer information that makes an informed judgment possible.
Why the other options are wrong
- A) Commission size is the opposite of the suitability standard; 14VAC5-45 keys the recommendation to the consumer's situation, not the producer's compensation.
- C) One-size-fits-all recommending defeats suitability; 14VAC5-45 requires the recommendation to match each consumer's own circumstances.
- D) Skipping the financial conversation is a violation, not a courtesy; 14VAC5-45 requires the consumer profile information as the foundation of a suitable recommendation.
Memory hook
Suit the customer, not the commission — reasonable basis from real consumer info.