Of the following actions, which one is NOT recommended by the OCC's advisory letter as a necessary tool of management oversight of insurance and annuity sales?
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A. B. C. D.B
The OCC (Office of the Comptroller of the Currency) issued an advisory letter on the management oversight of insurance and annuity sales. The letter provides guidance for banks and financial institutions that offer insurance and annuity products to their customers. The letter emphasizes the importance of effective management oversight in this area to ensure that customers receive fair and appropriate products.
Out of the given options, the action that is NOT recommended by the OCC's advisory letter as a necessary tool of management oversight of insurance and annuity sales is establishing a separate insurance agency (Option B).
Establishing a separate insurance agency may not be necessary for effective management oversight of insurance and annuity sales. Instead, the OCC recommends that banks and financial institutions should hire competent personnel, audit systems and controls, and require a member of management to actively oversee this function.
Hiring competent personnel is crucial for ensuring that customers receive suitable and appropriate insurance and annuity products. It is important to have qualified and trained staff who can identify the needs of customers and recommend products that meet those needs.
Auditing systems and controls is also necessary to ensure that the bank or financial institution is complying with all applicable laws, regulations, and internal policies related to insurance and annuity sales. Audits can identify any weaknesses or gaps in the systems and controls and allow the institution to take corrective action.
Requiring a member of management to actively oversee this function ensures that there is accountability and oversight at the highest level of the organization. This member of management should have a clear understanding of the risks associated with insurance and annuity sales and be able to make informed decisions about the products and services offered.
In summary, establishing a separate insurance agency is not specifically recommended by the OCC's advisory letter as a necessary tool of management oversight of insurance and annuity sales. However, the OCC does recommend hiring competent personnel, auditing systems and controls, and requiring a member of management to actively oversee this function.