A coalition of insurance companies and independent marketing organizations has filed suit in federal court to overturn Rule 151A, a new rule by the Securities and Exchange Commission that classifies indexed annuities as securities. The rule was published in the Federal Register on Jan. 16; the coalition filed the suit the same day.
“The securities laws say explicitly that annuities are to be regulated by the States, not the SEC. Unfortunately, the Commission engaged in a flawed rulemaking process whose result is a rule that conflicts with Congress’s intent and with two Supreme Court decisions,” said Eugene Scalia, the petitioners’ lawyer, in a press statement.
Jim Poolman, spokesperson for the Coalition for Indexed Products, is a former North Dakota Insurance Commissioner. He believes the SEC has decided to regulate indexed annuities at a time when the Commission has other pressing priorities.