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📋 '''Advised sale''' is a method of distributing [[Definition:Insurance policy | insurance products]] in which an [[Definition:Insurance intermediary | intermediary]] — typically a [[Definition:Insurance broker | broker]] or [[Definition:Insurance agent | agent]] — provides a personal recommendation tailored to the customer's specific needs, circumstances, and objectives before the customer commits to purchasing a policy. This stands in contrast to a [[Definition:Non-advised sale | non-advised sale]] (sometimes called an execution-only or information-only sale), where the customer selects a product without receiving a recommendation. The concept is particularly prominent in the United Kingdom under the [[Definition:Financial Conduct Authority (FCA) | Financial Conduct Authority's]] regulatory framework, but similar distinctions between advised and non-advised distribution appear across European markets governed by the [[Definition:Insurance Distribution Directive (IDD) | Insurance Distribution Directive]], in Hong Kong under the Insurance Authority's conduct rules, and in other jurisdictions that regulate how insurance is sold to consumers.

🔍 In an advised sale, the intermediary is obligated to gather sufficient information about the client — including their financial position, existing coverage, risk appetite, and specific protection needs — before recommending a product. The recommendation must be suitable for the customer, and the intermediary must be able to demonstrate the rationale behind it. This typically involves a documented [[Definition:Demands and needs statement | demands and needs]] analysis and, in some jurisdictions, a suitability report. The intermediary bears regulatory responsibility for the quality of the advice, which means higher compliance and training requirements compared to non-advised channels. For [[Definition:Insurtech | insurtech]] platforms and digital [[Definition:Insurance distribution | distribution]] models, replicating an advised sale online requires sophisticated question-based journeys, algorithm-driven recommendations, and careful documentation — a challenge that many technology-led distributors are actively working to solve.

⚖️ Regulators emphasize the distinction because of its direct impact on consumer protection outcomes. When a sale is advised, the customer has a legitimate expectation that the product was chosen with their interests in mind, and if the advice turns out to be unsuitable, the intermediary may face [[Definition:Professional indemnity insurance | professional indemnity]] claims and regulatory sanctions. This creates a higher standard of accountability that can reduce instances of [[Definition:Mis-selling | mis-selling]] but also increases the cost of distribution. For insurers and [[Definition:Managing general agent (MGA) | MGAs]] designing their distribution strategies, the choice between advised and non-advised channels shapes everything from product complexity and target market definitions to [[Definition:Commission | commission]] structures and technology investment. Markets with strong advice requirements tend to see greater intermediary involvement in complex lines such as [[Definition:Life insurance | life insurance]], [[Definition:Pension | pensions]], and commercial coverage.

'''Related concepts:'''
{{Div col|colwidth=20em}}
* [[Definition:Non-advised sale]]
* [[Definition:Insurance Distribution Directive (IDD)]]
* [[Definition:Demands and needs statement]]
* [[Definition:Suitability]]
* [[Definition:Mis-selling]]
* [[Definition:Insurance intermediary]]
{{Div col end}}

Definition:Advised sale - Revision history

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