Key Takeaways
- Minnesota producers have fiduciary duties to act in the best interest of clients
- Producers must disclose compensation arrangements and conflicts of interest
- Premium funds must be handled according to strict requirements
- Producers must maintain accurate records for required retention periods
- Continuing education includes mandatory ethics training
Last updated: January 2026
Producer Conduct and Fiduciary Duties
Minnesota insurance producers have legal and ethical obligations to their clients and the public.
Fiduciary Duties
A fiduciary is someone who acts in another's best interest. Insurance producers owe fiduciary duties to their clients:
Key Duties
| Duty | Description |
|---|---|
| Loyalty | Put client's interests first |
| Disclosure | Reveal all material information |
| Competence | Maintain professional knowledge |
| Confidentiality | Protect client information |
| Good Faith | Act honestly in all dealings |
Agent vs. Broker Duties
| Producer Type | Primary Duty To |
|---|---|
| Agent | Insurance company (but still must be fair to client) |
| Broker | Client/Insured |
Exam Tip: Brokers represent the client, while agents represent the insurer. Both have ethical obligations to treat all parties fairly.
Disclosure Requirements
Minnesota producers must disclose:
Compensation Disclosures
- Method of compensation (commission, fee, both)
- Material conflicts of interest
- Ownership interests in recommending insurers
- Referral arrangements
Handling of Funds
Producers must handle premiums and client funds according to strict rules:
Premium Collection
| Requirement | Rule |
|---|---|
| Deposit | Promptly to insurer or trust account |
| Commingling | Cannot mix with personal funds |
| Trust Account | Required for holding premiums |
| Records | Must maintain detailed records |
Trust Account Requirements
- Separate from personal accounts
- Clearly designated as trust account
- Detailed records of all transactions
- Regular reconciliation
- Available for Department of Commerce examination
Consequences of Mishandling
- License suspension or revocation
- Required restitution
- Civil liability
- Potential criminal charges
Continuing Education
Minnesota requires ethics training as part of CE:
- Ethics hours required every renewal period
- Must be Minnesota-approved courses
- Covers regulatory updates
- Includes case studies and examples
Test Your Knowledge
Which type of Minnesota insurance producer primarily represents the client?
A
B
C
D
Test Your Knowledge
Can a Minnesota insurance producer mix premium funds with personal funds?
A
B
C
D