Survey Reveals Widespread Confusion About Life Insurance Agents' Roles

PLEASANT HILL, Calif., Sept. 14, 2026 /CourierPR/ -- A new survey conducted by the Life Insurance Consumer Advocacy Center (LICAC) has revealed widespread confusion among consumers regarding the role and obligations of life insurance agents. The survey, which polled over 200 individuals who had purchased a life insurance policy within the past 10 years, found that more than 65% of respondents incorrectly believed that their agent had a legal obligation to act in their best interest.

Only 10% of respondents understood that their agent primarily represented the insurance company. Additionally, 40% of respondents believed that their agent represented the policyholder, and almost that many believed that the agent represented both the policyholder and the insurance company equally. These findings highlight a significant gap between consumer expectations and reality.

The survey also revealed that only 35% of respondents understood that agent compensation is commission-based and determined as a percentage of the premium paid by the policyholder. Furthermore, 94% of consumers were unaware that agent commissions could be 100% or more of the first year's premium.

According to Brian Brosnahan, President and Executive Director of LICAC, "Consumers are making decisions about products that can affect their financial security for decades, yet this survey shows many don't understand something as fundamental as who their agent represents. Too many consumers get victimized buying life insurance because they trust their agent more than they should, which may lead a consumer to accept a recommendation without really understanding what the consumer is buying."

Brosnahan further stated, "There are many honest and highly professional agents out there. But there are also many agents who are much more interested in the commissions they can make than in what is good for the consumer."

LICAC believes that California should follow New York's lead and impose an obligation on agents to act in their customer's best interest. This would protect and benefit consumers, while bringing agent obligations in line with what most consumers already think they are. Until such a "best interest obligation" is imposed, it will be important to educate consumers through disclosures at the beginning of the consumer-agent relationship. This includes informing consumers that the agent represents the insurance company and does not have an obligation to act in the consumer's best interest.

Richard Weber, Treasurer of LICAC, emphasized the need for stronger consumer protections and clearer disclosure requirements. "We need stronger consumer protections and clearer disclosure requirements. These are issues that deserve the attention of policymakers, the insurance industry, and candidates for California Insurance Commissioner."

The survey was conducted by Research America Inc. in early 2026 and provides a stark reminder of the need for greater transparency and consumer education in the life insurance industry. California voters will elect an Insurance Commissioner in November, providing an opportunity for greater discussion about consumer protections in the insurance marketplace.

The findings of the survey underscore the importance of ensuring that consumers are fully informed about the role and obligations of their life insurance agents. With nearly 10.2 million individual life insurance policies owned in California in 2024 and nearly $22 billion in life insurance premiums paid, the stakes are high. LICAC's mission is to alert the public and policymakers about the potential risks of certain types of life insurance products and to advocate for reasonable and essential consumer protections.