Karen (principal) hires John (agent) to be her financial planner. John recommends that Karen purchase a life insurance policy because he honestly believes that her family will benefit from it. He recommends a policy from UNeed Insurance because he will receive an undisclosed commission from the company if Karen purchases it.

Is John in breach of his duty to Karen?

Yes, this is self-dealing, and is therefore a breach of duty of the agent to the principal

Step-by-step explanation

• Self-dealing can be described as the act of a corporate officer, trustee or attorney to take advantage of the position they are in with the focus on their own interests and benefits rather than those of the principal
• John, in this case, has the responsibility of working for the benefits and interests of Karen, but rather, he is focusing more on the commission to be received
• for this reason, this is self-dealing, and he is guilty of the act