The state may also apply the annuity sales rules to sales of life insurance.
The New York State Department of Financial Services has included those provisions in a new set of proposed amendments to the state’s Suitability in Annuity Transactions regulation.
Links to several documents related to the proposed amendments are available here.
Comments on the proposed amendments are due Feb. 12.
Cuomo vs. Trump
Officials working under Maria Vullo, the New York State Department of Financial Services superintendent, developed the proposed regulation amendments.
But Gov. Andrew Cuomo, a Democrat, is using the proposal as a chance to show his approach to financial services regulation and the Trump administration’s approach.
“As Washington continues to ignore and roll back efforts to protect Americans, New York will continue to use its role as a strong regulator of the financial services and insurance industries to fight for consumers and help ensure a level playing field,” Cuomo said in a statement included in the press release announcing the proposal. “With these commonsense reforms we are working to protect everyday New Yorkers and give them peace of mind when purchasing these products.”
DOL Standards Delay
Under former President Barack Obama, the U.S. Department of Labor developed a fiduciary rule standard for sales of retirement services. The standard requires advice providers to put the clients’ interests first. A best-interest standard in the rule defines what it means to put the interests of the clients first.
When President Donald Trump came into office, his DOL team decided to let the best-interest standard take effect, but the team put off applying related regulations, or “prohibited transaction exemptions” (PTEs), that set the procedures retirement services would have used to show they were acting in the clients’ best interest.