Which statement about commission disclosure in the arrangement of financial products is true?

• A. Disclosure is required for all three products: term assurance, mortgage, and fixed term deposit.
• B. Disclosure is required only for term assurance policies.
• C. Disclosure is not required for fixed term deposits.
• D. Disclosure is required only if the client asks for it.

Answer: (A)

Transparency about how advisers are compensated should accompany recommendations across all major product areas. Clients need to know if and how the adviser will be paid for term life (term assurance), mortgage loans, and fixed-term deposits, including whether upfront commissions, ongoing trail payments, or any other remuneration come from the product issuer or are connected to the advice given. Providing this disclosure up front helps the client assess potential conflicts of interest and compare options on a like-for-like basis, not just on product features.

This is why disclosure is expected for all three types: it isn’t limited to one product, and it isn’t something to wait for a client to request.