photo by iStock of Washington at night (Credit: iStock)

Lawmakers introduced legislation Friday that would require the SEC to devise a new and more tailored form for annuity issuers to use when filing registered index-linked annuities (RILAs).

The bipartisan bill, the Registration for Index Linked Annuities (RILA) Act, S. 3795, was introduced by Sens. Tina Smith, D-Minn., and Thom Tillis, R-N.C., as well as Reps. Dean Phillips, D-Minn., and Steve Stivers, R-Ohio.

The Insured Retirement Institute said the legislation “will address the misalignment between the current registration forms used for RILAs and the information needed by investors who might benefit from purchasing these products.”

IRI had asked for such 2020 Federal Retirement Security Blueprint, which was released earlier this year.

Under current SEC rules, RILAs “and other innovative new products must be registered using forms that are designed primarily for equity offerings and therefore require extensive information that is not relevant to prospective annuity purchasers,” IRI said.

“These forms also require disclosure of financial information prepared in accordance with generally accepted accounting principles (GAAP), which many insurers are not otherwise required to produce,” the group explained.

The “current rules and process used to register RILAs stymies innovation, create a barrier to entry into this growing market for insurers that do not produce GAAP financials, and impedes consumer comprehension and choice with excessive and confusing information,” according to Wayne Chopus, IRI’s president and CEO, in a statement.

A new registration form “more closely tailored to the particular products being offered would ensure that consumers have access to the pertinent information they need to make an informed investment decision,” Chopus said.