(Bloomberg) — An Obama administration proposal designed to make sure that savers get the best advice on retirement products may squeeze pay for salespeople who pitch the offerings, Fidelity & Guaranty Life said.
“You could expect overall compensation, maybe in the long run, will come down,” Dennis Vigneau, chief financial officer of F&G, said Thursday at a conference hosted by Iowa insurance companies in Des Moines. People who sell the policies will “have to raise, certainly, their standards of disclosure.”
The U.S. Department of Labor has proposed a requirement that brokers and insurance agents put clients’ interests ahead of their own. Senator Elizabeth Warren, a Massachusetts Democrat, has said industry incentives such as cruises are leading brokers to give bad advice to their customers and called for more disclosure.
“There may not be incentive trips” under tighter U.S. rules, Vigneau said. “Although those sorts of trips aren’t really a big part of compensation, they do tend to grab the headlines.”