How to Ensure Your Broker is Licensed: 3 Steps to Take

When considering investing in a life settlement fund, it is essential to work with a qualified and licensed broker. Before you put down any cash, the first step is to ensure that your broker is properly licensed and knowledgeable in the industry’s laws and regulations.

By choosing the right broker, you can rest assured that your transaction will be secure and seamless. Below are the three most important steps you need to take to confirm a broker's credentials and ensure that you’re working with a licensed professional.

Step 1: Confirm the Broker’s Licensing Status

The first and most important step is to ensure that your broker has the proper licenses to legally invest in life settlement funds. Because licensing requirements vary from state to state, make sure that your broker meets the proper qualifications where you live.

Tips to verify a broker’s licensing:

• Request your Broker’s License Info: First, directly ask your broker for their license number and other proof of credentials that are required in your state.

• Contact State Regulatory Agencies: Most states have a Department of Insurance or comparable regulatory agency. Try visiting their websites or calling their offices for licensing information. Many of these agencies also have online search tools where you can search for brokers by their name and/or license number.

• Use National Resources: If you need additional verification, visit the National Association of Insurance Commissioners (NAIC). On their website, you can find additional resources and information to confirm that your broker is properly licensed.

Step 2: Look into your Broker's Professional History

After you’ve verified your broker’s licensing and qualifications, it’s important to look into their professional background. By working with trusted and experienced brokers, you can ensure that your investment will run smoothly and efficiently. 

How to review a broker’s background:

• Research their experience & reputation: A quick Google search is an easy way to confirm your broker’s experience. Look for online reviews and testimonials from trusted websites to ensure that your broker is well-respected in the industry.

• Look for Disciplinary Actions: Make sure to deep dive into your broker’s professional history to determine if they have received disciplinary actions or legal issues. You can usually find this information through the Department of Insurance and other state regulatory agencies.

Step 3: Talk to a Trusted Financial Advisor

Before choosing a broker, consider reaching out to your financial advisor or an attorney. They may be able to offer additional insight to help ensure that your broker not only has a good reputation in the industry but can also help you reach your financial goals.

How to Prepare for a Meeting with Your Financial Advisor:

• Bring a list of broker options: Before you consult with your financial advisor or attorney, make a list of brokers you are considering. Share this list with your advisor to see if anyone sticks out (whether good or bad).

• See if the Broker is the right fit: An advisor can help you determine if a broker’s services and offerings can benefit your financial strategy. By choosing a broker that understands your long-term financial goals, you can make the most of your investment.