National Association of Insurance and Financial Advisors

NAIFA Advocacy Gets Results: The DOL Rule Delay and Annuities

NAIFA advocacy has worked tirelessly in recent years to ensure that any fiduciary rule imposed by the Department of Labor would not disrupt markets and make it more difficult for consumers to get products that provide financial security in retirement. NAIFA provided education and insights to members of the current and previous administration on how some aspects of the proposed rule would harm advisors and, more importantly, their clients.
NAIFA was pleased when the Department of Labor decided to further review the rule and delay its full implementation until July 2019.   
“NAIFA has worked diligently throughout this process to educate the administration and members of Congress about the rule’s potential unintended consequences that could deprive middle-market savers of access to professional, individualized advice,” NAIFA CEO Kevin Mayeux said at the time. “We will remain vigilant to assure the DOL rule does not disrupt the marketplace, increase costs for retirement savers, and eliminate access for middle- and lower-income workers to individualized retirement planning services.”

Annuities: A Real-World Example

One of the greatest fears of retirees is that they will outlive their savings. That’s why it’s not a surprise that annuity products are an important part of many families’ retirement plans, providing the security of guaranteed income for life.
When the DOL issued its fiduciary rule in spring 2016, it created a great deal of uncertainty in the annuities market. The rule potentially would have made it riskier for broker-dealers and registered reps to sell variable annuities. Company compliance departments were determining how the rule would affect advisor compensation. Legal liability issues giving customers the right to bring class-action suits would also have resulted from full implementation of the rule.
Because of these factors, analysts from LIMRA had forecast sales of fixed and variable annuities to decrease in 2018 by up to 15 percent, Cyril Tuohy of InsuranceNewsNet reports. After the administration announced the delay, LIMRA revised its projections and now forecasts annuity sales to increase by up to 5 percent.
The improved outlook for annuities traces directly to the fact that the sales process for annuities is much simpler and the market much more stable than they would have been had the fiduciary rule gone into full effect.
Meanwhile, NAIFA’s advocacy continues.
“NAIFA members are on the front lines in communities across the United States serving the individuals, families and small businesses the rule is likely to impact the hardest,” Mayeux said. “NAIFA, ACLI and our coalition industry leaders will continue to inform lawmakers on the impact the rule is having on the industry and consumers. We look forward to working with the Department of Labor and Congress to ensure advisors are able to serve their clients and guide them to secure financial futures.”
  • Posted February 28, 2018 IN
  • Comments (4)

Mark Briscoe (NAIFA Staff)
Anil Kumar, thank you for your question. That would be a great topic of discussion to have with a professional insurance and financial advisor. You can find an advisor near you using the NAIFA Agent Locator
3/7/2018 8:06:58 AM
Hannah Kensington
Congratulations NAIFA!!
3/6/2018 2:06:50 AM
Anil Kumar
How can NAIFA help us get an annuity at cheaper rates?
3/5/2018 10:06:05 AM
Very good article, congratulations and thank you for the tips !
3/2/2018 12:42:26 PM