NU Online News Service, Sept. 5, 2003, 7:13 p.m. EDT – State insurance regulators are weighing complaints from the American Council of Life Insurers, Washington, about a proposed model regulation that would establish suitability standards for the sale of annuities to senior citizens.
Members of the executive committee of the National Association of Insurance Commissioners, Kansas City, Mo., discussed a draft of the Senior Protection in Annuity Transactions model during a conference call.
The model was adopted by the Life & Annuities “A” committee at the NAIC summer meeting in June.
Regulators talked about how they should respond to a request for changes by the ACLI. Regulators considered the possibility of adopting technical changes, making substantive changes or returning the model to the “A” committee for more work.
The executive committee voted to include the ACLI’s technical changes and consider a new draft for final adoption in Chicago.
One technical change incorporated in the latest draft would replace language that referred to producer recommendations about “annuity transactions” with language specifying recommendations about the purchase or exchange of an annuity.
In an Aug. 14 letter to the NAIC, the ACLI says one critical issue for ACLI member companies is the inclusion of variable annuities as well as fixed annuities under the purview of the model.
If the model will include variable annuities, then the model should apply to broker-dealers because broker-dealers’ registered reps distribute variable annuities, the ACLI says.