NASD Pushing New Oversight Requirements For Variable Annuities
Deferred variable annuities would come under a new set of suitability, disclosure and principal review requirements under a rule proposed by the National Association of Securities Dealers.
The proposed rule is specifically designed for deferred VAs, codifying and mandating best practice guidelines previously issued by NASD, says NASD Chairman Robert Glauber.
“Because of our concerns about unsuitable recommendations and inadequate supervision, variable annuity sales have been the focus of increased NASD-wide attention for the last 2 years and the subject of more than 80 disciplinary actions during that time,” Glauber says.
“We believe this rule proposal represents an appropriate approach to ensuring adequate protection for investors considering or purchasing deferred variable annuities,” he says.
But the American Council of Life Insurers, Washington, questions the need for the proposal.
“NASD already has authority to address any problems it perceives in this market,” says ACLI spokesman Jack Dolan.