State RegulationsMA specificDifficulty 2/5
Before recommending that a client purchase a long-term care policy, what must a Massachusetts producer do under the suitability requirement of 211 CMR 65.09(4)(b)?
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Answer & full 3-part explanation (select an option above, or peek)
Why D is correct
211 CMR 65.09(4)(b) imposes a suitability duty: the producer must make a reasonable effort to determine that the long-term care product recommended fits the client's needs and financial circumstances before the sale is made. The requirement, part of the Massachusetts Division of Insurance's long-term care marketing standards at 211 CMR 65.08 and 65.09, targets the classic abuse of selling expensive long-term care coverage to consumers who cannot reasonably afford it or who have no realistic need for it.
Why the other options are wrong
- A) The rule calls for a reasonable suitability assessment of the client's circumstances, not the forced collection of full tax returns.
- B) MassHealth eligibility is irrelevant to the producer's suitability duty for private long-term care coverage; the two are separate determinations.
- C) Suitability concerns whether the product fits the client's needs and finances; no medical certification of future care is required before recommending a policy.
Memory hook
Suitability first: fit the policy to the person, not the commission to the producer.