In 2018, North Dakota Governor Doug Burgum unveiled the state’s new brand: Be Legendary.
This week, Gov. Burgum signed a bill introduced by North Dakota Rep. George Keiser and Sen. Jerry Klein that provides North Dakota residents with robust consumer protections. Some might even call them legendary.
The legislation ensures that financial professionals must act in the best interest of North Dakota savers. It enhances the standards financial professionals must follow while ensuring that individual savers maintain access to, and information about, annuities, the only financial product in the marketplace that can provide guaranteed lifetime income.
This is a huge victory for all North Dakota citizens planning for retirement.
The law mirrors the National Association of Insurance Commissioners’ (NAIC) updated model regulation on annuity transactions. North Dakota is now the ninth state with a new law or rule that incorporates the NAIC model’s enhanced consumer protections. Several other states are considering similar measures to protect their citizens.
The actions in the states also closely align with the Securities and Exchange Commission’s Regulation Best Interest, which took effect last year.
With these enhanced state and federal consumer protections, savers can rest assured that financial professionals must act in the consumer’s best interest when offering recommendations about retirement savings products, including annuities. The U.S. Congress reaffirmed the importance of lifetime income when it passed legislation in 2019 that made it easier for employers to include annuities in workplace retirement plans. These protections safeguard consumers while also ensuring that middle- and working-class families will maintain access to practical and easy-to-understand financial information.
Preserving access to financial information is particularly valuable nowadays. The economic and societal turmoil sparked by COVID-19 has raised concerns for many Americans about their retirement security. These concerns can be lessened by thoughtful financial security tools, including annuities, which can provide income that retirees cannot outlive.
More states should follow the lead of North Dakota with this legendary consumer protection. Then more consumers across America will benefit from a best interest standard of care, regardless of where they live.
(Lyle Kraft, NAIFA-ND President, is an investment advisor located in Minot, North Dakota. Currently a registered advisor at Principal Securities, Inc., Kraft has 15 years of practice as a financial advisor. Kraft holds Series 65 and Series 63 licenses, which qualify the advisor as both a securities agent and an investment advisor representative.)
This article was originally published on the ACLI's Impact blog.