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August 04, 2020 at 03:54 PM
The U.S. Securities and Exchange Commission’s Office of Investor Education and Advocacy has updated the SEC’s Indexed Annuities investor bulletin.
Investors bulletins are not official batches of SEC guidance, but they may reflect the kinds of questions SEC officials are getting about a topic.
Resources
- A copy of the updated SEC indexed annuity bulletin is available here.
- An article about a House committee bill report that mentions the variable indexed annuity registration process is available here.
The investor education first posted the indexed annuities bulletin in August 2019.
Words
The SEC spent years trying to get the authority to regulate all indexed annuities as securities, the way it regulates ordinary variable annuities and variable life products as securities.
Congress blocked the SEC from automatically regulating non-variable annuities, which protect the holder against loss of account value, as securities. Instead, life insurers can file indexed annuities with account value guarantees as non-variable annuity products.
Issuers originally called those products equity indexed annuities. Once the conflict with the SEC cropped up, issuers began calling contracts with account value guarantees fixed indexed annuities.
Life insurers still register some indexed annuities with the SEC, as securities. By registering an indexed annuity with the SEC, a life insurer gives itself the ability to limit itself to protecting the holder against just some loss of account value, or do without value guarantees altogether.
The Insured Retirement Institute, the Secure Retirement Institute and some other industry organizations have been calling indexed annuities that are registered with the SEC “registered index-linked annuities,” or RILAs.
The Bulletin Update
A comparison of the bulletin update with an older version stored on Archive.org reveals many routine formatting changes.
