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Valmark Reworks Life Sales Tool for N.Y. Best Interest Era

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Valmark Financial Group is getting ready for the possibility that New York state’s new Regulation 187 best interest standard really will apply to life insurance as well as to annuities.

Valmark — an Akron, Ohio-based life insurance distribution and policy management company  — announced today that it has updated its Life Assurance 360 life insurance coverage design, implementation and management program to comply with the New York state best interest standards, and similar standards developed by the CFP Board.

A best interest standard requires the sellers of affected products to put clients’ interests first, and to document that they have put the clients’ interests first.

New York regulators say the state’s best interest standard will apply to annuities starting Aug. 1, and to life insurance starting Feb. 1, 2020.

(Related: New York State Final Best Interest Regs Cover Life As Well As Annuities)

Valmark said one part of its best interest compliance effort involved updating an existing Life Insurance Design Questionnaire form.

Valmark created the questionnaire with help from life insurers, and from the financial services firms that use Valmark services.

The questionnaire helps connect the life insurance policy benefits shown in the policy performance illustration with the policy contract features. That information can help play an important role in educating clients and improving coverage recommendations, Valmark said.

Valmark said it will be working with life insurers to help financial advisors use the questionnaire with all life insurers and all products.

Valmark will also be encouraging financial services firms and advisors to make more use of its systems for monitoring the performance of in-force life insurance policies.

That system can help advisors serve clients’ interests by determining whether life insurance policies are performing the way the policies were originally designed to perform, according to Valmark.

Both the questionnaire and the policy monitoring system can help financial services firms and advisors document the recommendations they are making, Valmark said.

Larry Rybka, chairman of Valmark, said in a statement about the firm’s process update that working to do a better job of putting the client first should be good for business as well as for compliance.

“We’ve done this not because of a minimum regulatory requirement, but because we see it as both an ethical obligation and competitive advantage to make better recommendations and provide a service for monitoring polices after they are placed,” Rybka said.

— Read How a Financial Services Distributor Sees the New Life Accounting Ruleson ThinkAdvisor.

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