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March 2021 Issue:


Congress Passes American Rescue Plan

On March 10, the House of Representatives passed the Senate version of H.R.1319, the American Rescue Plan. The latest coronavirus aid legislation extends certain tax credits (employee retention tax credit and payroll tax credit for coronavirus-related paid sick and family leave for employers with fewer than 500 employees) and provides enhanced Affordable Care Act (ACA) and COBRA subsidies. It also authorizes direct stimulus payments to certain individuals and extends federal unemployment benefits. The House voted on the bill as it was modified and passed by the Senate on March 6. The Senate vote was 50 to 49. The House vote was 220 to 211.

The Senate changed the version of H.R.1319 passed by the House (by a vote of 219 to 212) on February 27. Among the changes of most interest to NAIFA members are:

  • The offsets to the bill’s multiemployer pension rescue plan were changed. The Senate replaced the House bill’s 2031 repeal of inflation adjustments for contributions to and benefits paid from employer-sponsored retirement plans with an adjustment to the limitation on the deduction for corporation-paid compensation (section 162(m)). Under the change, the compensation deduction will be limited for the corporation’s top-paid eight (up from current law’s five) employees.
  • Enhanced COBRA coverage subsidies—The Senate modified the House’s 85 percent subsidy for COBRA coverage to 100 percent, until September 30, 2021.
  • The Senate dropped the House-passed phased-in increase in the federal minimum wage.
  • The Senate modified the House-approved unemployment benefit provisions—under the Senate provisions (included in the now-enacted bill), the federal supplemental unemployment benefit will be available through September 8, 2021, with the extra federal weekly benefit set at $300/week rather than $400/week. In addition, the Senate provision makes the first $10,200 in unemployment benefits tax-free for households that earn less than $150,000/year.
  • The direct stimulus payments to individuals remain at $1,400 per eligible individual. Eligible individuals are those who earn less than $75,000/year ($150,000 for a married couple). However, partial amounts of the $1,400 payable to those who earn above $75,000/$150,000 completely phase out as of incomes of $80,000/single ($160,000/married). That’s a decrease from the House provision that ended phased-down stimulus payments at income levels of $100,000/single ($200,000/married).

Many of the provisions in H.R.1319 remained the same after the Senate vote. So, the law as enacted contains provisions that would:

  • Extend the employee retention tax credit (ERTC) until January 1, 2022—prior to this new law, the ERTC would have expired at the end of June, 2021.
  • Extend the federal refundable payroll tax credit for coronavirus-related paid sick and family leave for businesses with fewer than 500 employees through September 30, 2021.
  • Increase Paycheck Protection Program (PPP) funding by $7.25 billion.
  • Expand ACA subsidies—The new law would expand, for 2021 and 2022, the ACA premium tax credit program. The provision caps what people must pay for individual or family health coverage purchased through an ACA exchange at a maximum of 8.5 percent of income. So, people with high incomes could qualify for the ACA premium tax credit subsidies if their premium payments exceed the 8.5 percent of income threshold, even if their incomes exceed the percentage of poverty cap that was part of the premium tax credit program prior to enactment of the American Rescue Plan.

H.R.1319 also provides money for state and local governments struggling with pandemic-related costs, funding to help safely reopen schools, money for COVID vaccination acquisition and distribution, funding for COVID testing and contact tracing, aid to restaurants and bars, money for transportation and disaster relief, rental assistance, an increase in the child tax credit, aid to airlines, and other provisions.

Prospects: Now a new law, H.R.1319 leaves a number of issues unsettled, including increasing the federal minimum wage, and whether to impose a federal paid leave policy or program on the nation’s employers. Still also open is whether Congress will do yet another coronavirus aid measure later this year. As of now, the economy appears to be rebounding and the pandemic looks like it may be abating. If those trends hold, another coronavirus aid bill is unlikely. However, expect reemergence of the minimum wage and paid leave issues as lawmakers shift focus from emergency aid to longer-range policy issues. 

NAIFA Staff Contacts: Diane Boyle – Senior Vice President – Government Relations, at DBoyle@naifa.org; Judi Carsrud – Assistant Vice President – Government Relations, at jcarsrud@naifa.org, or Michael Hedge – Director – Government Relations, at mhedge@naifa.org


House Passes PRO Act

On March 9, the House of Representatives passed the PRO Act (H.R.842), a bill containing a worker classification provision that could adversely impact many NAIFA members by disrupting their working relationships with their carriers. The problematic provision creates a national test to determine when a worker is an employee rather than an independent contractor. The vote was 225 to 206. Five Republicans voted “yes;” one Democrat voted “no.”

The PRO Act (short for the Protecting the Right to Organize Act) is largely a unionization measure, strongly supported by organized labor and most Democrats. However, it contains a worker classification provision that is harmful to many insurance companies and their agents/financial representatives. NAIFA and the carriers are lobbying hard to win an exemption for insurance agents and financial advisors from the PRO Act’s strict employee test, but because of cross-Congress rules, the issue is unlikely to be settled until the Senate takes up the bill. (The cross-Congress rule allows the House to vote on a bill that died when last year’s 116th Congress ended, without going through a new committee process, if the vote comes prior to April 1 and is on a bill unchanged from the 116th Congress.)

Generally, many NAIFA members work for their companies under an independent contractor arrangement, but their activities are closely regulated, at both the state and federal levels, by insurance and securities laws and rules. Under the PRO Act’s worker classification rule, such close regulation could trigger a classification of those workers as employees. 

In most respects, the PRO Act mirrors California’s “ABC” test of whether a worker is an employee or independent contractor. But the California ABC test contains an exception for insurance agents; the PRO Act does not. 

The ABC test classifies a worker as an employee unless the worker is free from the control and direction of the hiring entity in connection with the performance of the work, and unless the worker performs work that is outside the usual course of the hiring entity’s business, and unless the worker is customarily engaged in an independently established trade, occupation or business of the same nature as that involved in the work performed.

Prospects:  The PRO Act faces considerable opposition in the Senate, where it will need 60 votes to pass and where it will be hard-pressed to find even 51 votes. But the PRO Act is at the very top of organized labor’s wish list; it has the Biden Administration’s and a clear majority of Democrats’ support. And Democrats control the agenda in both the House and Senate. So, although chances for enactment are no better than 50-50, it is highly likely there will be a hard-fought battle over the bill in the Senate later this year. NAIFA will continue to fight for an exemption from the PRO Act’s worker classification rule.

NAIFA Staff Contact: Michael Hedge – Director – Government Relations, at mhedge@naifa.org


US Department of Labor Announces Plan to Rescind Two Final Rules on Worker Classification 

On March 11, the U.S. Department of Labor (DOL) announced plans to rescind two final rules that the Biden administration believes would significantly weaken protections afforded to American workers under the Fair Labor Standards Act.

The first Notice of Proposed Rulemaking proposes the withdrawal of the Independent Contractor Final Rule issued by President Trump’s Labor Department on Jan. 7, 2021. The reasons stated include:

  • The rule adopted a new “economic reality” test to determine whether a worker is an employee or an independent contractor under the FLSA.
  • Courts and the department have not used the new economic reality test, and FLSA text or longstanding case law does not support the test.
  • The rule would narrow or minimize other factors considered by courts traditionally; making the economic test less likely to establish that a worker is an employee under the FLSA.

Among its provisions, the FLSA requires covered employers to pay employees at least the federal minimum wage for every hour worked and overtime premium pay of at least one and one-half times their regular rate of pay for every hour worked over 40 in a workweek. An independent contractor has no FLSA protections. 

The proposed rule, which will set out the test for determining whether a worker is an employee or an independent contractor, is expected to replace the Trump Administration’s rule. The new proposed rule could have an adverse impact on NAIFA members who work as independent contractors for their carriers. The DOL’s Wage and Hour Division will publish its proposal to withdraw its Independent Contractor rule in the Federal Register on March 12 and is allowing a 30-day comment period for feedback. 

Based on insider expectations, it appears likely the new proposed worker classification rule will tilt toward, if not parallel, the worker classification rule in California (the “ABC test”) and/or the one in the pending PRO Act (a mirror of the California ABC test, but without the exemptions (including one for insurance agents) contained in the California law). The three-part ABC test focuses on the degree of control exerted by the hiring entity over the worker performing the Services. 

The second Notice of Proposed Rulemaking seeks to rescind a current regulation on joint employer relationships under the Fair Labor Standards Act, published in the Federal Register and which took effect on March 16, 2020. 

In February 2020, 17 states and the District of Columbia filed a lawsuit in the U.S. District Court for the Southern District of New York against the department, arguing that the Joint Employer Rule violated the Administrative Procedure Act. The court vacated the majority of the Joint Employer Rule on Sept. 8, 2020, stating that the rule was contrary to the FLSA and was “arbitrary and capricious” due to its failure to explain why the department had deviated from all prior guidance or consider the effect of the rule on workers.

Prospects: A new proposed worker classification regulation will complicate an already difficult issue that is currently pending before Congress. But it is one that is very important to many NAIFA members and their carriers. NAIFA conducted a survey of its membership to determine just how widespread the problem is and is using the resulting data to argue in favor of an exemption for insurance agents from the stringent ABC test. It now appears that the issue will set up a two-front battle—one in Congress and one at DOL. NAIFA will keep you posted.

NAIFA Staff Contact: Michael Hedge – Director – Government Relations, at mhedge@naifa.org


Mandatory Paid Leave Left Out of H.R.1319

Despite a call by President Biden to include a requirement that all businesses (including those with more than 500 employees) provide coronavirus-related paid sick and family leave, the requirement was left out of H.R.1319, the just-enacted new coronavirus aid bill. However, the legislation does include an extension (to September 30, 2021) of the refundable payroll tax credit for small employers (those with 500 or fewer employees) that voluntarily offer coronavirus-related paid sick and family leave.

Progressive Democrats continue to press for enactment of a federal paid leave program—both coronavirus-related and in general. However, it is not part of the just-enacted American Rescue Plan.

Prospects: Employers with 500 or fewer employees will continue to benefit, through the end of the federal government’s fiscal year (9/30/21), from the refundable payroll tax credit if they voluntarily provide coronavirus-related paid sick and family leave. No employer will have to provide this paid leave, but the federal government will help offset the cost of it should an employer with fewer than 500 employees choose to offer it.

NAIFA Staff Contacts: Diane Boyle – Senior Vice President – Government Relations, at DBoyle@naifa.org; Judi Carsrud – Assistant Vice President – Government Relations, at jcarsrud@naifa.org, or Michael Hedge – Director – Government Relations, at mhedge@naifa.org


Treasury Secretary Says Administration is Open to Certain Tax Increases

Treasury Secretary Janet Yellen said on February 22 that President Biden is open to certain tax increases. Among the possibilities Yellen mentioned were higher corporate tax rates, and an increase in the capital gains tax. 

Yellen told a virtual New York Times conference that President Biden favors raising the corporate tax rate from 21 percent to 28 percent. The revenue raised from that, she said, would be used to offset the cost of a “longer-term economic reconstruction program.” She also said that the Administration does not favor a wealth tax (i.e., a special extra levy on the very wealthy), but a capital gains tax increase “is worth considering.” She said a financial transaction tax (an FTT)—that is a levy of a few basis points (two to ten have been proposed) on each financial instrument trade—is something to explore.  “One would have to examine closely what effect it would have” on ordinary investors, she noted.

Prospects: Washington tax experts are expecting a legislative proposal—although probably not until later this year—that would raise taxes. The top individual tax rate as well as the deduction for pass-through business income are other potential tax increases. However, despite calls for this kind of tax increase, particularly from progressive Democrats, most lawmakers remain cautious about raising taxes while the economy is still struggling with adverse pandemic impacts. Still, these are proposals that bear a close watch as expensive infrastructure and climate change packages are in the works. 

NAIFA Staff Contact: Judi Carsrud – Assistant Vice President – Government Relations, at jcarsrud@naifa.org


Bill Would Make Pass-Through Business Income Deduction Permanent

A bill introduced on February 25 would make permanent the 20 percent deduction of qualified pass-through (non-corporate) business income (QBI). The deduction is currently set to expire at the end of 2025. 

The “Main Street Tax Certainty Act” H.R. 1381/S. 480 was offered by Reps. Jason Smith (R-MO) and Henry Cuellar (D-TX) in the House, and Sens. Steve Daines (R-MT), Bill Cassidy (R-LA), Tim Scott (R-SC), and Rob Portman (R-OH) in the Senate. This bipartisan legislation will help ensure permanent tax parity for the millions of employers organized as S corporations, partnerships, and sole proprietorships. It will also provide certainty to the countless businesses who have been devastated by the COVID-19 pandemic.  

The deduction (Internal Revenue Code Section 199A) is available to sole proprietorships, S corporations and partnerships, although there are qualification standards that a business must meet in order to take the deduction. It was enacted into law in 2017 as part of the Tax Cuts and Jobs tax reform law.

On February 26, 2021, NAIFA and more than 80 business groups wrote to Senate Finance and Ways and Means leaders to support the legislation making permanent the 20-percent pass-through deduction.

Prospects: It is unlikely that legislation to make the 199A deduction permanent will pass Congress any time soon, if at all. It is controversial—many Democrats view it as a give-away to the rich—and its expiration date does not come for more than three years. Repeal of its expiration date will also trigger a loss to federal revenues, an issue that will become increasingly sensitive as the U.S. emerges from the economic crisis caused by the pandemic. But it is a high-priority issue for Republican lawmakers, and the balance of political power could change between now and 2026, so this legislation is best viewed as the opening gambit in the effort to eliminate the QBI deduction’s expiration. 

NAIFA Staff Contact: Judi Carsrud – Assistant Vice President – Government Relations, at jcarsrud@naifa.org


IRS Releases Guidance on Interaction of PPP Loan and ERTC

On March 1, the Internal Revenue Service (IRS) released guidance about how 2020 Paycheck Protection Program (PPP) borrowers can take advantage of the employee retention tax credit (ERTC). Generally, Notice 2021-20 restricts the ERTC deduction to payroll amounts that were not included in a forgiven PPP loan. The guidance applies to PPP loans taken in 2020.

The coronavirus aid bill enacted into law late last year allows PPP borrowers to qualify for the ERTC. The ERTC is a tax credit that rewards businesses for keeping its employees on the payroll during the pandemic.

Notice 2021-20 also covers the interaction between forgiven PPP loans and the ERTC when a business has gotten only partial forgiveness of their PPP loan, or if the business was denied forgiveness. 

Prospects: The IRS said it would soon be releasing guidance for 2021 PPP loans and their interaction with the ERTC. There remain many unanswered questions, including whether wages paid to an S corporation’s owners and their actively employed spouses can qualify for the ERTC.

NAIFA Staff Contact: Judi Carsrud – Assistant Vice President – Government Relations, at jcarsrud@naifa.org


Bicameral Wealth Tax Bill Introduced


Sen. Elizabeth Warren (D-MA) and Reps. Pramila Jayapal (D-WA) and Brendan Boyle (D-PA) introduced legislation that would impose an extra tax on households and trusts valued at $50 million or more. 

The “Ultra-Millionaire Tax Act,” introduced in both the House and Senate on March 1, would impose a two percent extra tax on individuals and trusts valued at between $50 million and $1 billion. It also imposes a three percent tax, on individual and trust net worth above $1 billion. Sen. Warren said a University of California Berkeley study of the proposal found that it would generate $3 trillion over ten years in new revenue for the federal government.

The Warren-Jayapal-Boyle proposal joins a wealth tax proposal focused on the estate tax offered last Congress by Sen. Bernie Sanders (I-VT), the “For the 99.8 Percent Act.” The Sanders bill would also lower the estate tax exclusion to $3.5 million (indexed) and the gift tax exclusion to $1 million (indexed). It would also increase the estate tax rate, in graduated increments from 45 percent to 77 percent on estates worth $1 billion or more. It also changes the generation-skipping tax rules and grantor trust rules. Sen. Sanders also cosponsored the Warren-Jayapal-Boyle legislation.

Prospects: President Biden does not favor a wealth tax, although many far-left progressive Democrats are calling for one, saying it would reduce the income inequality/wealth gap problem and provide needed revenue for such social priorities as childcare, infrastructure and education. There is more support for changes to capital gains tax rules. Potential changes include increasing the capital gains tax rate, and a proposal by Sen. Ron Wyden (D-OR) that would treat annual increases in the value of most investments as taxable income. 

Both Sen. Warren and Rep. Boyle are members of Congress’ tax-writing committees (Finance in the Senate; Ways & Means in the House) which is where action on any wealth tax proposal will originate. Sen. Wyden chairs the Senate Finance Committee, and thus controls that committee’s agenda. Sen. Sanders chairs the Senate Budget Committee. 

Thus, although prospects for any of these bills being enacted into law this year are not good, chances are all of them will generate considerable debate. And as the country emerges from the economic challenges of the pandemic and confronts the spiking federal deficit that resulted from emergency coronavirus-triggered spending, the risks from the wealth tax (and other revenue-raising proposals) will increase.

NAIFA Staff Contact: Judi Carsrud – Assistant Vice President – Government Relations, at jcarsrud@naifa.org


NAIFA-ID Testifies at Hearing on Annuity Best Interest Legislation

NAIFA-Idaho member EmmaLee Robinson testified before a hearing of the Idaho Legislature on the Annuity Consumer Protections Act (HB 79) and encouraged lawmakers to adopt legislation based on the National Association of Insurance Commissioners’ updated Suitability in Annuity Transactions Model. The NAIC model requires financial professionals to work in the best interests of consumers on annuity transactions.

The model increases consumer protections while preserving the ability of insurance and financial advisors to serve Main Street clients. It allows consumers to choose to work with advisors who offer various compensation models. The Model also aligns with the Security and Exchange Commission’s Regulation Best Interest, avoiding potential confusion and contradictions differing state regulations could cause.

NAIFA Staff Contact: Julie Harrison – State Chapter Director – Government Relations, at jharrison@naifa.org; Maeghan Gale – Policy Director – Government Relations, at mgale@naifa.org


NAIFA-WA Urges LTC Bill Changes to Protect Employees With Private Coverage

NAIFA-WA is urging changes to a long-term services bill, HB 1323, to protect employees who have purchased long-term care coverage.

The bill would have required employees to have purchased long-term care coverage prior to July 28, 2019, to opt out of payroll taxes and the state's Long-Term Services and Supports (LTSS) Trust Program.

In response to testimony by NAIFA, the American Council of Life Insurers (ACLI), and individual licensed insurance producers, Rep. Joe Schmick (R) introduced an amendment to remove the purchase deadline requirement. Unfortunately, the Schmick amendment failed to pass a House Health Care & Wellness Committee vote. However, an amendment by Rep. Steve Tharinger (D) passed a committee vote and would change the opt-out provision so the private insurance purchase deadline would be HB 1323's enactment date (approximately July 24, 2021) rather than July 28, 2019.

The bill passed the House and will next be heard at the Senate Health & Long-Term Care Committee.

NAIFA Staff Contact: Julie Harrison – State Chapter Director – Government Relations, at jharrison@naifa.org; Maeghan Gale – Policy Director – Government Relations, at mgale@naifa.org


NAIFA-FL Holds a Virtual Legislative Day

NAIFA-Florida’s Virtual Legislative Day on the Hill was February 23. Approximately 80 participants joined the event and received legislative and regulatory updates as well as advocacy training from NAIFA-FL President Craig Duncan and state lobbyist Tim Meenan of Meenan P.A. Other speakers included Florida Insurance Commissioner David Altmaier.

Among the 2021 policy priorities for NAIFA-FL are:

  • Urging amendments to bills, SB 54 and HB 719, that would eliminate Florida’s flawed Personal Injury Protection (“PIP) no fault auto insurance system and replace it with a mandatory bodily injury requirement. NAIFA-FL supports amendments to the legislation to avoid overly subjective guidelines in the bad faith portion of the bill and to resolve potential implementation problems.
  • Supporting legislation, SB 76 and HB 305, that would make reforms to rules governing the state property insurance market.
  • Supporting legislation to change the Department of Financial Services’ continuing education requirements for agents so that a 5-hour CE update course required every two years would be changed to a 4-hour course. The total CE required for licensing would remain the same, but one hour would be removed from the update course and become an additional elective credit.

Unfortunately, COVID-19 measures prevented direct meetings with legislators during the Virtual Legislative Day on the Hill. NAIFA-FL members will be reaching out to meet with their lawmakers in the coming months.

NAIFA Staff Contact: Julie Harrison – State Chapter Director – Government Relations, at jharrison@naifa.org; Maeghan Gale – Policy Director – Government Relations, at mgale@naifa.org


NAIFA-WI Objects to Proposed Layers of Data Privacy Regulations

NAIFA-WI joined other trade associations representing the insurance and financial services industry to push back on a potential regulatory proposal that would complicate existing data privacy and security laws.

The proposed Wisconsin Data Privacy Act (WDPA) was introduced last legislative session and NAIFA-WI does not feel it accounts for the existing regulations and regulatory authorities that currently oversee the industry. The groups wrote a letter to state Rep. Shannon Zimmerman stating that “for regulated industries, this would create an additional web of regulations, subjecting different types of data to different regulatory requirements with different state agencies.”

The letter requests that the WDPA be narrowed to exempt highly regulated industries like insurance and financial services that are already subject to extensive data regulation. The letter also outlines specific concerns and objections with the WDPA. The outline was written to underscore the challenge of enacting a single regulatory framework for all data “controllers” and “processors” in the state. The letter explains why industry-specific regulations will lead to a better result for consumers and businesses in Wisconsin.

In addition to NAIFA-WI, the letter was signed by the American Council of Life Insurers, American Property Casualty Insurance Association, Independent Insurance Agents of Wisconsin, National Association of Mutual Insurance Companies, Professional Insurance Agents of Wisconsin, Wisconsin Bankers Association, Wisconsin Council of Life Insurers, Wisconsin Credit Union League, and Wisconsin Insurance Alliance.

NAIFA Staff Contact: Julie Harrison – State Chapter Director – Government Relations, at jharrison@naifa.org; Maeghan Gale – Policy Director – Government Relations, at mgale@naifa.org


NAIFA-TN Urges End of Professional Tax on Advisors and Broker-Dealers

NAIFA-TN is using its advocacy muscle to convince state legislators to eradicate its professional privilege tax. The tax was used to balance budgets in 1992 and in 2002 and Tennessee is one of only six states with such a tax. Until two years ago, the tax applied to 22 different professions, including dentists, physicians, and real estate principal brokers. In 2019, Tennessee removed the discriminatory tax on 15 of the professions yet continues to require attorneys, securities agents, broker-dealers, investment advisers, lobbyists, osteopathic physicians, and physicians to pay the annual $400 tax.

“Tennessee has more than 100 licensed professions; seven remain singled out for this tax, which is discriminatory,” said a letter cosigned by NAIFA-TN. “Tennessee is a very good state in which to conduct business, but we believe it’s an opportune time to 1) send a clear, across-the-board message that it’s a right and not a 'privilege' to run a business in Tennessee; 2) eliminate a double tax on professionals who already are paying licensing fees…”

NAIFA-TN has been engaged on this issue for many years but remains optimistic on the issue in 2021, especially with the partnership it has formed with:

  • Tennessee Small Business Association
  • Tennessee Medical Association
  • Tennessee Bar Association
  • Americans for Prosperity Tennessee
  • Americans for Tax Reform
  • Tennessee Lobbyists Association
  • Securities Industry and Financial Markets Association
  • Tennessee Bankers Association
  • Financial Services Institute

NAIFA Staff Contact: Julie Harrison – State Chapter Director – Government Relations, at jharrison@naifa.org; Maeghan Gale – Policy Director – Government Relations, at mgale@naifa.org


NAIFA-WI Holds Virtual Day

NAIFA-WI presented its annual Day on the Hill on March 8 and 10. The event highlighted the importance of political advocacy for insurance financial advisors. The event was open to all insurance and financial professionals in Wisconsin and briefed attendees on important legislative and regulatory issues.

Key speakers included Rep. David Steffen, Chair of the Assembly Committee on Insurance; Rep. Kevin Petersen, Assistant Majority Leader; Sen. Mary Felzkowski, Chair of the Senate Committee on Insurance, Licensing and Forestry; and Commissioner of Insurance Mark Afable. 

Legislative and regulatory items that were on the agenda included the NAIC model bill on annuity suitability; the NAIC model bill on cybersecurity; a bill to help protect against financial abuse of senior citizens; and a bill to create a state-run retirement plan for non-government employees.  

NAIFA Staff Contact: Julie Harrison – State Chapter Director – Government Relations, at jharrison@naifa.org; Maeghan Gale – Policy Director – Government Relations, at mgale@naifa.org


NAIFA-TX Holds Successful Virtual Day at the Capitol

NAIFA-TX held a successful legislative event in early March, with several dozen participants. The annual Day at the Capitol was planned as a hybrid event, with both in-person and virtual attendees. However, the lingering effects of recent winter storms required NAIFA-TX to quickly shift to an all-virtual event.

Despite this last-minute change, NAIFA-TX members met virtually with 34 legislators or their policy staff between Feb. 23 and Feb. 25. Another three meetings were scheduled, but were postponed and will be held soon. The event also included a meeting during which NAIFA members discussed their state legislative priorities for the coming year. These include:

  • Supporting legislation (HB 1777) that would enact the NAIC’s revised annuities transaction model, which would protect consumers by requiring financial professionals to act their best interests.
  • Legislation (HB 437) to add a financial literacy course to the state’s high school graduation requirements.

“Our members overcame serious challenges during a pandemic and following an extraordinary winter storm to make this legislative event a great success,” said NAIFA-TX Government Relations Manager Bianca Alonso. “Despite the necessary pivot away from in-person meetings, we were able to strengthen our connections with state lawmakers, tell them stories about the great work insurance and financial professionals do in our state, and advocate for policies that promote financial security for all Texans.”

NAIFA Staff Contact: Julie Harrison – State Chapter Director – Government Relations, at jharrison@naifa.org; Maeghan Gale – Policy Director – Government Relations, at mgale@naifa.org


NAIFA-ND Tells Lawmakers Their Clients Come First

NAIFA-ND President Lyle Kraft testified at the State Senate Industry, Business and Labor Committee on March 9, on the importance of passing an important new best interest standard.

In February 2020, the National Association of Insurance Commissioners (NAIC) adopted revisions to the Suitability in Annuity Transactions Model Regulation to incorporate a Best Interest standard of care. HB 1160 reflects these amendments.

Kraft testified that annuities are complex products, providing lifetime income guarantees, and design options based on the needs of the consumer and therefore merit a best interest of the consumer standard of care.

“Best interest says, ‘I’m going to put my clients interests in front of my own, and I’m going to meet our obligations,’” Kraft said. “In North Dakota, these are values that we believe in. Not all my friends are my clients. But I want to know that whoever they are working with is putting my friend's best interest ahead of their own.”

The bill easily passed through the House and was adopted in the Senate Committee on the same day of Kraft’s testimony.

NAIFA members subscribe to a Code of Ethics that require them to put clients’ interest first. NAIFA is encouraging all states to adopt the NAIC amendments on best interest.

NAIFA Staff Contact: Julie Harrison – State Chapter Director – Government Relations, at jharrison@naifa.org; Maeghan Gale – Policy Director – Government Relations, at mgale@naifa.org