The board of the American Council of Life Insurers will urge states to extend product suitability standards for annuities to all consumers, not just older consumers.
The current Senior Protection in Annuity Transactions model regulation adopted by the National Association of Insurance Commissioners, Kansas City, Mo., extends suitability protection only to consumers ages 65 and older.
North Dakota Insurance Commissioner Jim Poolman recently said at a conference sponsored by the ACLI, Washington, that he intends to open up the NAIC model and extend protections in the model to all annuity purchasers.
Poolman spoke after Robert Glauber, chairman of the National Association of Securities Dealers, Washington, asked in an earlier speech why the suitability model protects only older annuity purchasers.
“Last year, we demonstrated our commitment to consumer protection with our support for the Senior Protection Model, which has been adopted in a number of states,” ACLI President Frank Keating says in a statement about the group’s decision to support a broader suitability model. “We are taking one step further now, advocating that the insurance needs and financial objectives of consumers of all ages who purchase annuities are carefully considered.”
Linda Lanam, ACLI vice president-annuities, says ACLI will begin working with states immediately on efforts to revise laws and regulations based on the model.
The process will vary from state to state, depending on what state insurance commissioners want to pursue and how suitability measures are put in place, Lanam says.