Delaware is getting an annuity sales standards regulation based on the new National Association of Insurance Commissioners’ annuity suitability model update.
Delaware Insurance Commissioner Trinidad Navarro approved the model update Jan. 15, and the Delaware Department of Insurance published the regulation adoption and final order document earlier this week.
The update is set to take effect Aug. 1.
The NAIC worked to make its update to the Suitability in Annuity Transactions Model Regulation compatible with the U.S. Securities and Exchange Commission’s Regulation Best Interest. The SEC developed Reg BI during the administration of former President Donald Trump.
The model update requires annuity sellers to act in consumers’ best interest, and it lets annuity sellers collect commissions from the annuity issuers, rather than relying solely on fees from the purchasers.
Delaware’s move to adopt the NAIC model update means that Delaware, like a number of other states, will be trying to implement regulations designed to mesh well with Reg BI at a time when some in the administration of President Joe Biden might try to modify Reg BI.
Biden represented Delaware in the U.S. Senate from 1973 through 2009, and its possible that Navarro’s decision to approve the regulation update could get Biden’s attention.
Arizona, Arkansas, Iowa, Michigan and Rhode Island have also adopted laws or regulations implementing the NAIC model update.