Firm Overview

Comprehensive Planning & Insurance Analytics (CPIA) was established in March of 2005 to serve a need in the evolving Financial Planning / Fee-Advisory industry. Consumers continue to search for advisors who can provide unbiased counsel in a fee-engagement venue that is free of conflict. Yet, only a small percentage of firms are providing such services.

Those that do, have established a higher bar of professional standards and comply to the principles of Fiduciary Responsibility. There is no clear acknowledgement from the firms who do not provide these same standards of excellence, as they seek ways around regulatory guidance in order to circumvent the issues of full disclosure, transparency, and placing the interest of the client as the first priority of performance.

Financial Planning is a functional engagement of a sustained relationship between the advisor and the client. This relationship encompasses the development and monitoring of asset strategies and risk management in a coordinated and synchronized fashion. Regardless of how a firm may promote itself to create a certain image, the fact remains that there are numerous areas of conflict and compromise in product implementation that do not promote the client's best interest. These conflicts have a direct relationship to the lack of full disclosure of the product.

The fee-advisory firm that is dually registered (SEC and NASD) invites more conflict scenarios than that of the firm that is registered only with the SEC. This does not establish an absolute for the SEC registered firm, except that the conflicts may be less in scope and more easilt identified.

Registration with the NASD is desired if a firm has a dual compensation practice model (referring to both fees and commissions). Although compensation structure is not the defining benchmark as to fiduciary responsibility and standards, current conditions and lack of guidance allow for abuse in several areas of product recommendation. The key question is not necessarily compensation, but how does the method of compensation affect the structure and performance of the product or service being proposed? Is the ommission of details regarding cost components and assumptive relationships necessary for the product to appear attractive? Are costs "bundled" so that they are not easily discerned?

In addition, the practice of financial planning and fee-advisory services require the use and development of any number of strategies that could be beneficial to the overall success of a particular client. Many of the strategies are viable, but some are contrived as a marketing tool with the objective of pushing product sales.

One of the primary components of the financial planning process involves the use of life insurance. Whether the need is for income replacement, estate taxes, asset protection and preservation, wealth transfer, charitable objectives, or all of the various elements of business planning, life insurance is a primary tool for risk management and/or asset management.

Of all the planning tools available to the fee-advisor, life insurance (and annuities) represents the farthest point of separation between fiduciary standards and product design. This creates a conundrum for the fee-advisor / wealth management firm that has established fiduciary responsibility and standards as a basis for their practice.

How can existing, needed, or proposed life insurance be analyzed and designed with a methodology and format that is applicable to fiduciary standards of responsibility?

Although the insurance industry has concentrated on product compensation as a driving force for their distribution channels, there are products available that have full disclosure and transparency. In addition, there is methodology to reverse engineer and "scrub" policy illustrations, allowing for a transparent analysis of cost and capital efficiencies.

Our firm has focused on these issues and developed the defining qualities that can bring life insurance (and annuity) planning, with policy design and implementation, into the same fiduciary environment that the fee-advisory firm has established as a basis of client relationship.

In addition, although our experience has evolved out of the commission insurance culture, we can present these services without the bias of commission influence. In most cases, the use of fully disclosed no-load insurance is the vehicle of choice. It serves as a standard for policy comparisons, and provides the greatest cost and capital efficiencies for the client.

However, a commission based policy may be best suited depending on the policy style and the particular circumstances of the client. In such a situation, full disclosure and analysis is still provided for the consumers benefit.

Therefore, the firm we service can take comfort in the fact that the summaries and recommendations put forth will be focused on what is best for the client, validated by full disclosure and transparency.