What You Need to Know
- Nineteen states have adopted the model update.
- Pennsylvania is the highest-population adopter with a Democratic governor.
- Texas is the biggest adopter with a Republican governor.
Pennsylvania has given a big boost to efforts by the National Association of Insurance Commissioners to support the SEC’s Regulation Best Interest financial services sales standards.
Gov. Tom Wolf recently signed Senate Bill 772 — legislation implementing the NAIC’s annuity suitability model update in the Keystone State.
Wolf’s signature means that Pennsylvania is the highest-population state with a Democratic governor that has adopted the suitability model update.
California, Illinois and New York have not adopted the model. Florida, a state with a Republican governor, is another state that us now outside the fold.
What Your Peers Are Reading
Texas is the highest-population state that has signed on. A total of 19 states have now adopted the model.
For agents and brokers who collect commissions for selling annuities, Pennsylvania’s move may increase the odds that insurers will continue to pay sales commissions to annuity sellers.
The American Council of Life Insurers, the National Association of Insurance and Financial Advisors Pennsylvania and the Insurance Federation of Pennsylvania put out a joint announcement welcoming Pennsylvania’s adoption of the suitability model update.
The NAIC is a Kansas City, Missouri-based group for insurance regulators. The group designed its model update to complement Reg BI, rather than a fiduciary standard-based retirement investment product sales regulation developed by the Department of Labor during the administration of President Barack Obama.