Close Close

Practice Management > Building Your Business > Leadership

Fiduciary rule tops agenda at NAFA Annuity Leadership conference

Your article was successfully shared with the contacts you provided.

Members of the National Association for Fixed Annuities will gather this week in Washington, D.C., at the association’s annual Annuities Leadership Forum and Hill Walk to discuss issues and regulation affecting the fixed annuity market.

Topping the list of forum topics will be the Department of Labor’s fiduciary rule, which NAFA has publically criticized. The association filed a lawsuit last week seeking a preliminary injunction to stay the rule on grounds that the Labor Department exceeded its authority to regulate Individual Retirement Accounts and improperly categorized insurance agents as fiduciaries.

Chip Anderson was new on the job as executive director of the Washington, D.C.-based association when the Labor Department’s proposed fiduciary rule was released in April of 2015. Since that time, Anderson and the association have been focused on education and advocacy surrounding the rule.

Anderson recently answered questions about his first year as executive director at NAFA, the association’s position on the new fiduciary rule and what members can expect at NAFA’s forum this week:

LHP: You’ve been NAFA’s executive director for a little over a year. How would you describe your first year in this position with NAFA? What are some accomplishments you would highlight?

Chip Anderson: As the executive director of NAFA, my first year has been focused mostly on the DOL rule that came out on April 20, 2015, just 10 days before I took over at NAFA. We immediately formed a working group of key people in our industry and met every other week to address the issues presented with the new rule. The group developed comment letters to respond to the DOL and met in person with the DOL at their office in Washington, D.C. We continued to try to educate the DOL on fixed annuities and their position in retirement planning for Americans with conference calls and discussion with our representatives in D.C., while we worked with our fellow trade groups in the financial services industry. Over the past year, the NAFA staff has been dedicated to promoting the value of fixed annuities with our meetings and education efforts for our membership, we have a fantastic and very knowledgeable staff at NAFA.

LHP: After examining the final DOL fiduciary rule released in April, what are NAFA’s concerns about the rule?

CA: Our biggest concern with the DOL rule is the impact it will have on the millions of Americans that will not get access to the financial advice for their retirement planning due to the onerous guidelines that the DOL has created with this new rule.

LHP: Has NAFA’s position on the rule changed following the release of the final rule? Is it better or worse than expected in your view?

CA: The final rule that was released by the DOL in April of 2016 created a drastic change for fixed indexed annuity products. The DOL made a significant change in their positioning of FIAs putting them under the Best Interest Contract Exemption guidelines which is much worse than their previous position in the DOL proposed rule released in April of 2015.

Continue reading …

LHP: What advocacy and actions is the association planning to take regarding the rule over the next several months?

CA: NAFA hired the law firm of Bryan Cave in Washington, D.C., to help us review and analyze the DOL rule and NAFA has taken action in order to protect the American consumers’ ability to have access to FIA products for safe and guaranteed products that also offer a guaranteed income for life for their retirement planning.

LHP: Aside from the fiduciary rule, what other trends are you seeing in the annuities marketplace?

CA: While almost all of our focus has been on the DOL rule, we see sales increasing the last few years for fixed annuity products with people looking for the safety and guaranteed income features that fixed annuity products offer. Sales have been up significantly while consumer complaints have been very low compared to many other financial products available in the marketplace.

LHP: Are there additional initiatives NAFA is focused on, policy or otherwise, besides the fiduciary rule?

CA: NAFA also monitors all state issues regarding the fixed annuity products and changes by the state insurance commissioners regarding the sales process, suitability and compliance concerns. Our goal is to educate the consumers, the legislators and those involved in the sales process of fixed annuity products.

LHP: What can attendees expect to learn at this year’s Annuities Leadership Forum?

CA: Attendees at our meeting in Washington, D.C, will hear from senators and congressmen sharing their view on the DOL rule. They will also get an up-to-the-minute update on the position NAFA is taking on the DOL rule and how it will affect them going forward. This will be one of the most important meetings NAFA has had with its members in many years.

LHP: What is the purpose of the Hill Walk, and why is it important this year in light of the fiduciary rule?

CA: The purpose of the Hill Walk at our meeting is to get our NAFA members in front of their senators and congressmen, in their office in Washington to inform them of the major concerns with the DOL rule and how it will affect millions of Americans and their retirement planning in the future. We will also explain the affect this rule will have on the insurance companies, the agents and reps selling the products, and the many small business that distribute the fixed annuity products in the marketplace.

See also:

DOL 101: The fiduciary rule’s impact on insurance-only agents

NAFA: The meandering economy

NAFA: Emotional stories make an impact with Congress

We’re on Facebook, are you?