An agent acts as a ______________ for all money received in their capacity as an agent.

The correct answer is "fiduciary" because in the context of insurance and agency relationships, a fiduciary is someone who is entrusted to manage assets or funds on behalf of another party. This role comes with a legal obligation to act in the best interests of the person or entity they represent.

When an agent receives money in their capacity as an agent, they hold that money in a fiduciary capacity, which means they must handle it responsibly and according to the terms of their agreement. This includes accurately reporting and remitting funds to insurance companies or clients as applicable. The fiduciary relationship emphasizes trust, integrity, and accountability, which are essential for maintaining the confidence of clients and business partners.

In contrast, the other terms do not capture the nature of the agent's responsibility regarding handling funds. An employee acts under the direction of an employer, an independent contractor works independently and may not have the same level of responsibility towards clients, and a principal refers to the entity being represented by the agent, rather than the agent themselves. Therefore, "fiduciary" correctly encapsulates the trust and responsibility involved in managing money received by an agent.