Insurers, funds raise the bar, hire CFPs in sales force

In order to raise the professionalism in selling insurance or mutual fund products, the financial industry players have decided to recruit candidates with a 'certified financial planner' (CFP) tag from the Financial Planning Standards Board (FPSB) India.

ICICI Life Insurance, ICICI Mutual Fund, SBI Life Insurance, PNB Principal Mutual Fund and Reliance Mutual Fund are among those who have agreed to give preference to CFPs while enrolling candidates for their agency force.

These companies have made a commitment through a recent resolution, said FPSB India CEO Ranjeet S Mudholkar.

The growing acceptance of CFP certification is underscored by SBI Life Insurance's decision to ask its top performing agents to take the FPSB examination and get CFP certification.

Rajiv Kumar Gupta, senior vice-president (agency channel) of SBI Life said the insurer will get its top 100 to 200 agents CFP certified to enhance their financial planning advice capabilities.

The Insurance Regulatory and Development Authority has already accorded recognition to the examination conducted by FPSB and allowed insurance companies to appoint CFPs as insurance advisors without having to go through the stipulated 100 hours of training.

FPSB is also in talks with the Securities and Exchange Board of India for allowing its CFPs to be engaged as mutual fund advisors without having to go through the examination process of the Association of Mutual Funds of India.

FPSB India is an affiliate of FPSB of the US and is a professional standards setting body, proactively developing and promoting the standards for financial planning professionals.

Sanjay Sachdev, FPSB India chairman, said that FPSB certified financial planners will meet competency and ethics standards based on a platform of education, examination, experience and ethics requirements. As many as 1,800 agents have joined as members of FPSB India and are pursuing the CFP certification.

FPSB's ethics code debars a CFP from pushing financial products and giving irresponsible advice.

Monitoring of CFPs is done through several channels including customer complaints and information gathering from fellow CFPs.

Noel Maye, chief executive officer of FPSB of the US, said that certification puts a fiduciary obligation on CFPs to give priority to the interests of customers.