The cross-country movement of states embracing the best interest annuity rule for consumers has just gained more ground in the South.
The Louisiana Department of Insurance, led by Commissioner Tim Temple, has filed a proposal to adopt a new rule aimed at improving standards for annuity transactions. The move aligns with a broader national effort to safeguard retirement savers and ensure they receive transparent information about annuities.
The newly proposed rule seeks to mandate that financial professionals adhere to heightened standards, and ensure consumers have comprehensive access to details about annuities.
To date, 45 states have implemented similar “best interest of consumer enhancements” in accordance with the National Association of Insurance Commissioners’ Suitability in Annuity Transactions Model Regulation, according to the National Association of Insurance and Financial Advisors.
As it stands, over 90 percent of Americans live in states where annuity transactions are made in accordance with a best interest standard that aligns with the SEC’s federal-level Reg BI rule, according to NAIFA.
The NAIC best-interest standard for annuities stands at odds with the DOL fiduciary rule passed in April, which addresses investment advice made to retirement savers. That rule, critics argue, constricts consumers' options for retirement savings by setting overly high standards for professionals recommending annuities.
Early this month, the DOL fiduciary rule faced its first legal challenge in the court system, advanced by a cadre of critics including the Federation of Americans For Consumer Choice.
Last Tuesday saw a legislative push against the rule in Congress through a bicameral joint resolution, which was sponsored by a group that includes Representative Rick Allen, R-Ga., and Senators Ted Budd, R-N.C., and Joe Manchin, D-W.Va.
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