The American Council of Life Insurers likes most of what it sees in the U.S. Securities and Exchange Commission’s new “Regulation Best Interest” proposal, but it worries that something will go wrong.
Carl Wilkerson, a vice president at the Washington-based insurer group, writes about the ACLI’s SEC sales standard fears in a new comment letter.
Wilkerson wrote the letter in response to the SEC’s efforts to take the sales standards fight over from the U.S. Department of Labor.
One reason for concern is that the SEC gives little attention to life insurers in the proposal, does nothing to assess the impact of the proposal on life insurers, and relies on reports, such as a broker-dealer study from RAND, that see little about life insurers, Wilkerson writes.
The SEC proposal for a form related to the best interest proposal “is built on a template of full a full-service broker-dealer and fits limited purpose broker-dealers or investment advisers affiliated with life insurers poorly,” Wilkerson writes.
Wilkerson gives non-cash agent compensation as an example of a life insurance tradition that needs extra attention.
Life insurers have used production credits to reward agents with plaques, extra educational opportunities, tech support and marketing assistance for decades, Wilkerson writes.