What Advisors Owe Their Clients: Fiduciary Responsibility, Facts, Integrity And Trust

The Warner Companies' Philip Snyder, CLU discusses what “fiduciary” means (and doesn’t mean) in the world of financial advice, and why consumers should focus on representation and integrity rather than labels. They discuss suitability as a process grounded in fact-finding—understanding goals, assets, family needs, and long-term affordability—before any recommendation is made. Philip explains that marketing is meant to sell, while good advice is built on factual research tailored to the individual.

He also covers conflicts of interest, including warning signs like pushing the same products to everyone, and how compensation can influence incentives. The conversation emphasizes ongoing reviews: client circumstances and market assumptions change, so a product illustrated at purchase may not perform as expected years later. They also touch on what happens when a firm is acquired and how that can change standards and procedures—while advising clients to ask how those changes affect them personally. The episode closes with the idea that scrutiny isn’t a bad thing: it helps ensure you get what you’re paying for and that the advice stays aligned with your needs.

Jeffrey Snyder, Broadcast Retirement Network

Three, two, one. Joining me now is Philip Snyder, Senior Vice President with the Warner Companies and for full disclosure, he's also my father. Dad, great to see you.

Thanks for joining us this morning.

Philllip Snyder, CLU, The Warner Companies

As usual, Jeff. It's a pleasure. Good morning to you.

Jeffrey Snyder, Broadcast Retirement Network

Thank you. Thank you. Always good to see you and I look forward to seeing you in about a week's time in good old Balmer.

All right, Dad. I think it's important that we talk about the fiduciary standard and suitability. So let me start with a baseline question.

Is every broker, advisor, consultant, whatever you want to call it, is everyone a fiduciary?

Philllip Snyder, CLU, The Warner Companies

I don't know that they're a fiduciary in the sense that they are legally held to fiduciary standards, but by and large, I think the general context of what a fiduciary is applies to life insurance people, annuity salesmen as well.

Jeffrey Snyder, Broadcast Retirement Network

So they may not be under the definition of the law and there's ERISA, obviously, which describes the fiduciary standard. Then there are state fiduciary standards. But do you think when looking to hire someone who does what you do or advises somebody, is that the first question or one of the first questions you should ask?

Are you a fiduciary? Meaning, do you have my best interests at heart when you're making decisions and recommendations?

Philllip Snyder, CLU, The Warner Companies

Well, I think the latter is what you should be asking people. You're really talking about the integrity of the salesperson and who do they really represent. Are they representing you, the buyer, and your family and your interests?

Or are they, to some extent, compromising that standard in favor of themselves? That's the fundamental issue at hand.

Jeffrey Snyder, Broadcast Retirement Network

And let's be clear here. I mean, there is a lot of marketing, and I'm not opposed to marketing. There's a lot of marketing that's out there from insurance companies, asset managers, brokers, advisors.

All these people may, obviously, they're outselling a product or a type of product, but you really need to be aware of what is marketing versus what is factual research. I think that backs up a conclusion.

Philllip Snyder, CLU, The Warner Companies

Well, yeah. I mean, obviously, marketing is designed to attract interest in a product, a company, whatever the case may be. In actuality, one-on-one relationships are developed.

And I think it's those relationships that you try and cultivate and build over time. And the only way to build those over time is through trust. There has to be trust.

So whether I'm a legally bound fiduciary or not really doesn't impact how we handle business in our firm.

Jeffrey Snyder, Broadcast Retirement Network

So let me ask you. Say I come to you as a non-son, so I'm not related to you in any way, and we decide to work together. I sign all the agreements with you and your company.

Let's talk about suitability. So how do you determine if Jeff's what you're going to propose? And you're mostly dealing in the realm of life insurance.

But let's just say hypothetically that you dealt in other types of products. One of the first things you have to figure out is, is it suitable for me as a person, as an individual, and for my family?

Philllip Snyder, CLU, The Warner Companies

Well, sure. I mean, that's the fact-finding aspect of what you're doing. Before you ever give a recommendation, I need to know what the objectives are, what your assets are, what your interests are.

Tell me about your family structure, your business interests, whatever they may be. I've got to delve into all those things to determine what may be the proper solution for you. That's really the goal.

And then can you afford to pay for that solution? Not only today, but looking ahead into the future. How's this solution if it's life insurance?

Whatever it may be, how are you going to be able to handle those ongoing obligations long-term? So I think suitability is certainly a major factor in what we do.

Jeffrey Snyder, Broadcast Retirement Network

And do you have to, you know, I don't want you to give away the inside baseball, but as part of your process. So you meet with me as a client. I sit down with you and I say, Mr. Snyder, this is my situation. This is what I'm looking for. Do you document that? And does that documentation get put anywhere within the firm's databases, for example?

Philllip Snyder, CLU, The Warner Companies

There are suitability questions that we as a broker have to answer to the insurance company. What do we do to get to the point where we made this recommendation and so forth? And how is the client going to finance that?

And what's the capability of the client to do that? So sure, we have to disclose that information at the time to the insurance company. Again, that doesn't make us a fiduciary legally, but it creates a certain higher level, a higher standard that we have to meet, which is a good thing.

Jeffrey Snyder, Broadcast Retirement Network

Right. I mean, at the end of the day, you know, this isn't, I bring up Bernie Madoff only because he just popped into my head because of what happened. You know, he tried to gain the trust.

He did gain the trust of people. Obviously, that's an extreme example. But trust is almost at the, you know, the fiduciary standard is a legal standard.

But the trust standard, you know, I have to be able to trust you as a professional.

Philllip Snyder, CLU, The Warner Companies

That's correct. Now, that insurance is only one part of what we do here. We do money management.

Oftentimes, we're selling variable insurance products, which have an investment orientation built into them. Those are higher standard levels. People then have to meet a higher level of standards in order to acquire those products.

Those are registered products with the securities with the SEC. And therefore, we have to meet a higher level of requirements in order to market those products to those individuals.

Jeffrey Snyder, Broadcast Retirement Network

And let me ask you this, and I'm sorry, I feel like we're playing like, I feel like you're under interrogation, but you're really not. I'm just trying to pull out what I think is important for the audience, and also for me. Let's talk about conflicts of interest.

Are there ever opportunities, areas where a firm, me, or you, a person as an individual may have conflicts of interest? And how do you tease that out? Is that part of that interview process?

When someone comes to visit you and says, hey, I'm looking for life insurance, I'm looking for money management, I'm looking for X, Y, or Z?

Philllip Snyder, CLU, The Warner Companies

Well, I think fundamentally, what you're looking for, back to what I said earlier, you're looking for someone who's going to represent your interests. So for example, if I'm an agent, not a broker, but an agent for a company, and every time I meet with a client, I make the same, I solve that problem with the products of that one company, I'd have to call that into question in some ways, because not every company has the most suitable product for every situation. So in our operation, in our business here, we're searching across a broad spectrum of solutions and carriers and so forth, types of products, to meet the needs of the client.

Jeffrey Snyder, Broadcast Retirement Network

So I think, let me just jump in real quick. So here, what I think I hear what you're saying is personalization, that we're all unique, obviously, physically, intellectually, situationally, we're all unique. And when you're looking at different product sets, I guess a key indicator of a conflict would be if you're putting everybody into this, not you, but a broker, an individual is putting somebody in the same, for example, annuity or life insurance product across the board.

Philllip Snyder, CLU, The Warner Companies

Yeah, I mean, that's a simple explanation of what I'm trying to say. You know, there's a lot of things we can do within life insurance products, for example, we can control the level of compensation that we receive. And we have our own internal standards of how we deal with that.

I can't speak for how others deal with that. So we're trying to make a fair level of compensation. Every dollar we get up front is taken from the performance of the product long term.

It's as simple as that. So we're trying to weigh the compensation, for example, that we receive on a particular life insurance product against the value conveyed to the participant, to the purchaser. And we need to make a reasonable level of compensation, but we don't need to knock it out of the park every time.

Jeffrey Snyder, Broadcast Retirement Network

Well, as a follow up to that, so, you know, this isn't a one time, you know, wham bam, here's your product, ma'am. Can you tell us a little bit about the benchmarking and the ongoing? Because fees are important.

Look, every basis point or half basis point that is taken out of fees is less money in the account that can earn, grow in perpetuity, theoretically. So how do you make sure that the product is still suitable a year from now, 30, not 30 years, but a year from now, five years from now?

Philllip Snyder, CLU, The Warner Companies

Well, you have to do reviews, not just for the product, but situations which the clients need at that point in time. Has the need changed? Do they need more?

Do they need less? Did they sell the business and move on to something else? Did they have an inheritance?

Did they win the lottery? I mean, on and on. Circumstances dictate, right, how you work with people over time.

I mean, I'm working with some people now, not to bore your viewers, who we're doing insurance reviews now. We're back checking the performance of the products that they bought years ago vis-a-vis what they thought they bought when they bought it. So did the product actually meet the expectations that were the original expectations of the buyer?

In many cases, they don't for a number of reasons, but mostly the interest rate environment has changed over time. And so if a policy was illustrated, let's say a permanent policy, a universal life policy with a 7% interest rate, but it's only armed for over the longest period of time, it's not going to perform the way you originally thought it was. So these things have to be addressed, just isolating the product aspect of it.

But you have to talk to people. You have to go back and say, what's new in your circumstances? What's new in your health?

What's new in your broader spectrum of your life? What's new? What's changed?

And how has that impacted your thinking about your financial planning? So that's just part of the process.

Jeffrey Snyder, Broadcast Retirement Network

Yeah. Let me ask you about ours. It's no secret that the financial services world, retirement world has gone through a lot of M&A activity, mergers and acquisitions activity.

In fact, I believe that your firm is now part of a broader, larger firm. How does that change? So if I'm dealing with you under a certain arrangement, but that firm is acquired, should I, as a customer, as a consumer, should I go back and ask you questions about that and do my own due diligence?

Because materially, being acquired by another firm could be a major change.

Philllip Snyder, CLU, The Warner Companies

Well, it could, but more, I think the process is you shouldn't have to call me. I should be calling you and saying, guess what? Our firm was acquired, which it was several years ago, and it's acquired by this organization.

And here's what that means to you and to our firm.

Jeffrey Snyder, Broadcast Retirement Network

And there may be a repayment. Well, and I think so. I mean, but I also think that there's a shared role as a consumer.

You know, I think it should be, I think my personal opinion is, though you may not have the technical competency, you can always, you have the technical competency to ask, how does this affect me individually? And I'm sure that, you know, as firms get acquired, there's new management, there's new standards. All those things change over time.

New standard operating procedures change.

Philllip Snyder, CLU, The Warner Companies

No question. Very much so. But the question from the buyer's standpoint is how all that, if you distill all that down, what impact does it have upon me, the buyer, right?

And me, actually, the intermediary, the broker, right? Are things going to change in the way we manage our relationship? I think that's what you're asking.

So, and that, you know, you can't speak here. In our case, I think it's only made things better. New management, different approach to things, a much broader array of things we can now do.

So having, you know, so in this case, it's better. It may not always be better in some circumstances. So those are my only questions.

Jeffrey Snyder, Broadcast Retirement Network

Yeah, really important. Dad, I got news for you. We got to run, but I want to say that you did not fold under questioning.

I do, I think it did, I think it did kind of feel like an interrogation that was certainly not my intent. But, you know, as you were talking, and I really want to kind of hone in on these issues, I think it's important in the world that we live in today. I don't think inherently people are bad, but I think you have a responsibility as a consumer to make sure that you're getting what you pay for and you need to be, you know, scrutiny is not a bad thing.

Philllip Snyder, CLU, The Warner Companies

Trust. And we have to deliver and meet your expectations. That's the point also.

That's maybe a bigger point because you don't know that, you know, it's like inside baseball. You may not know inside baseball, but you know what you want the score to be at the end.

Jeffrey Snyder, Broadcast Retirement Network

That's true. But you're bringing up a really sore subject because our Orioles are not very good. Dad, we're going to have to leave it there.

Always a pleasure chatting with you. And look, we look forward to having you back again very soon, sir.

Philllip Snyder, CLU, The Warner Companies

All right, Jeff. Thanks. My pleasure.