American Council of Life Insurers (ACLI) President and CEO Susan Neely, National Association of Insurance and Financial Advisors (NAIFA) CEO Kevin Mayeux and NAIFA-Kentucky Immediate Past President Brian Wilson issued the following joint statement on the annuity best interest rule recently adopted by the Kentucky Department of Insurance:
“The new rule adopted by the Kentucky Department of Insurance is an important win for Bluegrass State consumers seeking lifetime income in retirement. It incorporates the enhanced consumer protections in the National Association of Insurance Commissioners’ (NAIC) updated model regulation on annuity transactions.
“Moreover, it adds to the nationwide push for improved protections for retirement savers. Kentucky is the 17th state to adopt the NAIC model rule, which also aligns with the SEC’s Regulation Best Interest. Unlike a fiduciary-only approach, these measures make sure savers, particularly financially vulnerable middle-income Americans, can access information about different choices for long-term security throughout retirement. According to a new study, a fiduciary-only approach would limit choices for consumers, reduce savings of nearly 3 million people by $140 billion and widen the racial wealth gap by 20%.
“The U.S. Congress confirmed 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 retain access to annuities.
“We hope more states follow Kentucky and implement this practical protection so more consumers across America can benefit from a best interest standard of care, no matter where they live.”