The New York Department of Financial Services has sent life insurers another reminder: Moving cash from a deferred annuity to an immediate annuity is an annuity replacement transaction, and insurers have to make to make sure the consumers involved get income comparisons and suitability information.
The New York department has imposed about $2 million in fines and restitution requirements on three insurers in connection with immediate annuity replacement transactions.
The New York department imposed $1.8 million in fines and restitution requirements on six insurers in connection with immediate annuity replacement transactions in September.
Linda Lacewell, the department’s financial services superintendent, said in a comment about the new settlements that the state wants to protect seniors who are seeking safe and stable retirement income.
“Today’s settlements provide a measure of monetary restitution, especially important during the COVID-19 pandemic, and are a reminder that all New York’s life insurers must comply with DFS regulations and act in the consumer’s best interest,” Lacewell said.
- A collection of the consent orders is available here.
- An article about the income annuity exchange fines New York regulators imposed in September is available here.
The new settlements involve units of Lincoln Financial Group, Massachusetts Mutual Life Insurance Company and Pacific Life.
The companies have entered into consent orders agreeing to the settlements.